How to: Termination of an Interest Rate Swap

If an interest rate swap shall be closed before originally maturity date a close function is used in the form Interest rate swap (Deal input).

Step-by-step guide

1. Go to Deal input/ Interest Rate Swaps
2. Click on the button Close swap
   
   
3. Fill in the effective date of the closure in Value date and the interest differential compensation in Settlement amount field. The amount shall be exclusive accrued interest. It is important to enter a negative sign if the amount is payable. If there is no compensation paid fill in 0,00.

4. The swap is then closed. The actual interest periods will be shortened to the close value date.
   

5. If the interest differential compensation amount was negative, a new transaction is created on the payer leg and the amount is visible in Oth C/R Amount field. If the cost/revenue shall be accrued over the rest of the contract period, let the Maturity day be the last day of the original contract. If the cost/revenue shall be taken directly in the income statement, change the Maturity date to the day after the value date. In this example 161215.