Mexican Bonos

Best Practices Guide

Last Update: 7/17/2013

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OVERVIEW

Overview

Mexican Federal Government Development Bonds with fixed interest rates are referred to as Mexican Bonos.

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These bonds have several specific characteristics:

• Issued for longer than one year

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REFERENCE DATA

Unique attributes of Mexican Bonos are described below.

• Face Value: 100 pesos (one hundred pesos).
• Term: can be issued for any term, as long as this term is a multiple of 182 days. They are frequently issued for 3-, 5-, 10-, 20-

  (typically 3-year, 5-year, 10-year, 20-year, and 30-year terms

  .

  )

• Interest

  Period: interest

  is paid semiannually

  ,

  every 182 days

  or on the banking business day that substitutes this date in the event of a holiday.
• Interest Rate: fixed rate, determined by the federal government upon issuance. It is specified to investors in the auction announcement and in the notices that are published every time there is a new series.
• Interest Payments: interest is paid at the end of each interest period, based on the effective number of days that elapsed between payment dates, based on a 360-day year.

Security Master

To value Mexican Bonos accurately in Eagle the Quantity Scale (tag 19) must be changed from 1.00 to 100. This is the only change necessary for Accounting purposes.

Mexican Bonos SMF Example

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• (subject to holidays) using the ACT/360 day count

• The interest rate is determined at issuance and investors are notified in auction announcements and notices that are published with each new series

• Each unit of face value is equal to 100 pesos (1 trading unit is equivalent to 100 units of par)

Reference Data

Storage & Configuration

Eagle models Mexican Bonos security master files (SMFs) as single rows in Data Management.

Market Data

Mexican Bonos use standard par-based pricing (around 100).

Security Data

Mexican Bonos can be set up and maintained using Issue Viewer or Reference Data Center (RDC). The list below contains all fields required to configure a Mexican Bonos SMF.

• Issue Name (961)

• Primary Asset ID (14) & Primary Asset ID Type (1432)

• Processing Security Type (3931) = DBIBFD (Interest Bearing Debt Instrument)

• Price Multiplier (18) = 0.01

• Quantity Scale (19) = 100

  • This is critical for accurate valuation because each trading unit is equivalent to 100 units of par

• Issue Country (1418) = MX

• Asset Currency (85) = MXN

• Coupon (70)

• Coupon Type (97) = F (Fixed Rate)

• Day Count Basis (471) = ACT/360

• Payment Frequency (472) = 182_D (182 Days)

• Issue Price (69)

• Issue Date (68)

• Dated Date (1183)

• First Coupon Date (473)

• Last Coupon Date (474)

• Maturity Date (38)

• Maturity Price (42) = 100

• Trading Flat (3949) = No

• OID Indicator (218)