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Sinking ILBs should be set up as regular ILBs in Eagle, using Processing Security Type (3931) = DBFLTP and Sink Flag = No. Enter the stated interest rate and define the inflation-related fields as appropriate for the issue country. More details on country support and associated setup in Inflation-Linked Bonds (ILB) Best Practices.

Trade Processing

Open (

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event type: BUY or SHORTSELL)

Trades should be booked at par value as of trade date, not including any inflation adjustments. If this is prior to any scheduled sink dates, it will be the full original par value of the trade. If the initial open is after a scheduled sink date it will be the current outstanding principal, not including any inflation adjustments.

Accounting will automatically calculate the inflation-adjusted par, cost, traded interest, and net amount.

Close (

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event type: SELL or BUYCVR)

When partially or fully close a Sinking ILB position, enter the actual amount of par to be closed based on outstanding par value as of trade date. For example, if a 1,000,000 position has been factored down to 500,000 and you need to close out half the position, enter a close for 250,000. As with the open, this should not include any inflation adjustments.

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