Enthofer/Haas (Hrsg./eds.)

Handbuch Treasury / Treasurer's Handbook

Praxiswissen für den Geld- und Kapitalmarkt / Financial Markets: A Practitioner's Guide

2. Aufl. 2012

ISBN: 978-3-7143-0238-7

Folgeauflage 3. Aufl. 2020 verfügbar

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Dokumentvorschau

Handbuch Treasury / Treasurer's Handbook (2. Auflage)

S. 1284PART VIII Annex

S. 12861. Formulary

1.1. Financial Mathematics

1.1.1. Calculating Simple Interest

The formula for calculating simple interest (single payment of interest and a term of less than one year) is:

I = amount of interest

C = capital amount

r = interest rate in decimals (i.e. 5% = 0.05; 10.3% = 0.103; etc.)

D = number of days of interest period

B = day basis of calculation (fixed number of days per year)

Example

Bank A gives a 1-month deposit of Euro 5 m at 3%. Start date of this credit is October 1^st and end date is November 1^st. The actual number of days for this period is 31. Basis of term calculation is 360 days per year. The absolute interest of this credit is:

On November 1^st, the borrower will either

pay interest of Euro 12,916.67 and roll over the credit, or
settle the credit by paying back the principal plus interest: Euro 5,012,916.67

1.1.2. Average Interest

If different interest rates apply over several interest periods while giving or taking money, the average interest rate may be calculated like this:

r_AV = average interest rate

r₁,r₂,....r_n = interest rate of the respective terms of ...