Guidance on Deposit and Lending adjustment rates

Introduction

The following notes on deposit adjustment rates and lending adjustment rates are gathered from Subject Matter Expert guidance and responses to participant questions.

Representing Honeymoon rates

There are several ways to describe a honeymoon rate:

• a VARIABLE base rate (e.g., currently 5%) with an INTRODUCTORY discount (-1% for 12 months) = 4%
• a FIXED base rate (e.g., 5% for 2 years) with an INTRODUCTORY discount (-1% for 12 months) = 4%
• a FIXED base rate (e.g., 4% for 2 years, which may revert to a different VARIABLE rate) = 4%

An alternative to the INTRODUCTORY discount type could be DISCOUNT. However the Standard accommodates a period of time, specified in the additionalValue field, for the INTRODUCTORY type. There is no way to express the expiry period for a DISCOUNT rate.