MT565: (16) Field 22F: Indicator: Method of Interest Computation Indicator
FORMAT
Option F  :4!c/[8c]/4!c  (Qualifier)(Data Source Scheme)(Indicator) 
PRESENCE
Optional in optional subsequence B1
QUALIFIER
(Error code(s): T89)
Order 
M/O 
Qualifier 
R/N 
CR 
Options 
Qualifier Description 

1 
O 
MICO 
N 

F 
Method of Interest Computation Indicator 
DEFINITION
This qualified generic field specifies:
MICO 
Method of Interest Computation Indicator 
Specifies the computation method of (accrued) interest of the financial instrument. 
CODES
If Data Source Scheme is not present, Indicator must contain one of the following codes:
A001 
30/360 (ISDA) or 30/360 (American Basic Rule) 
Method whereby interest is calculated based on a 30day month and a 360day year. Accrued interest to a value date on the last day of a month shall be the same as to the 30th calendar day of the same month, except for February, and provided that the interest period started on a 30th or a 31st. This means that a 31st is assumed to be a 30th if the period started on a 30th or a 31st and the 28 Feb (or 29 Feb for a leap year) is assumed to be a 28th (or 29th). It is the most commonly used 30/360 method for US straight and convertible bonds. 
A002 
30/365 
Method whereby interest is calculated based on a 30day month in a way similar to the 30/360 (basic rule) and a 365day year. Accrued interest to a value date on the last day of a month shall be the same as to the 30th calendar day of the same month, except for February. This means that a 31st is assumed to be a 30th and the 28 Feb (or 29 Feb for a leap year) is assumed to be a 28th (or 29th). 
A003 
30/Actual 
Method whereby interest is calculated based on a 30day month in a way similar to the 30/360 (basic rule) and the assumed number of days in a year in a way similar to the Actual/Actual (ICMA). Accrued interest to a value date on the last day of a month shall be the same as to the 30th calendar day of the same month, except for February. This means that a 31st is assumed to be a 30th and the 28 Feb (or 29 Feb for a leap year) is assumed to be a 28th (or 29th). The assumed number of days in a year is computed as the actual number of days in the coupon period multiplied by the number of interest payments in the year. 
A004 
Actual/360 
Method whereby interest is calculated based on the actual number of accrued days in the interest period and a 360day year. 
A005 
Actual/365 (Fixed) 
Method whereby interest is calculated based on the actual number of accrued days in the interest period and a 365day year. 
A006 
Actual/Actual (ICMA) 
Method whereby interest is calculated based on the actual number of accrued days and the assumed number of days in a year, that is, the actual number of days in the coupon period multiplied by the number of interest payments in the year. If the coupon period is irregular (first or last coupon), it is extended or split into quasi interest periods that have the length of a regular coupon period and the computation is operated separately on each quasi interest period and the intermediate results are summed up. 
A007 
30E/360 or Eurobond basis 
Method whereby interest is calculated based on a 30day month and a 360day year. Accrued interest to a value date on the last day of a month shall be the same as to the 30th calendar day of the same month. This means that a 31st is assumed to be a 30th and the 28 Feb (or 29 Feb for a leap year) is assumed to be equivalent to a 30 Feb. However, if the last day of the maturity coupon period is the last day of February, it will not be assumed to be a 30th. It is a variation of the 30/360 (ICMA) method commonly used for eurobonds. The usage of this variation is only relevant when the coupon periods are scheduled to end on the last day of the month. 
A008 
Actual/Actual (ISDA) 
Method whereby interest is calculated based on the actual number of accrued days of the interest period that fall on a normal year, divided by 365, added to the actual number of days of the interest period that fall on a leap year, divided by 366. 
A009 
Actual/365L or Actual/Actual (basic rule) 
Method whereby interest is calculated based on the actual number of accrued days and a 365day year (if the coupon payment date is NOT in a leap year) or a 366day year (if the coupon payment date is in a leap year). 
A010 
Actual/Actual (AFB) 
Method whereby interest is calculated based on the actual number of accrued days and a 366day year (if 29 Feb falls in the coupon period) or a 365day year (if 29 Feb does not fall in the coupon period). If a coupon period is longer than one year, it is split by repetitively separating full year subperiods counting backwards from the end of the coupon period (a year backwards from a 28 Feb being 29 Feb, if it exists). The first of the subperiods starts on the start date of the accrued interest period and thus is possibly shorter than a year. Then the interest computation is operated separately on each subperiod and the intermediate results are summed up. 
A011 
30/360 (ICMA) or 30/360 (basic rule) 
Method whereby interest is calculated based on a 30day month and a 360day year. Accrued interest to a value date on the last day of a month shall be the same as to the 30th calendar day of the same month, except for February. This means that a 31st is assumed to be a 30th and the 28 Feb (or 29 Feb for a leap year) is assumed to be a 28th (or 29th). It is the most commonly used 30/360 method for nonUS straight and convertible bonds issued before 01/01/1999. 
A012 
30E2/360 or Eurobond basis model 2 
Method whereby interest is calculated based on a 30day month and a 360day year. Accrued interest to a value date on the last day of a month shall be the same as to the 30th calendar day of the same month, except for the last day of February whose day of the month value shall be adapted to the value of the first day of the interest period if the latter is higher and if the period is one of a regular schedule. This means that a 31st is assumed to be a 30th and the 28th Feb of a nonleap year is assumed to be equivalent to a 29th Feb when the first day of the interest period is a 29th, or to a 30th Feb when the first day of the interest period is a 30th or a 31st. The 29th Feb of a leap year is assumed to be equivalent to a 30th Feb when the first day of the interest period is a 30th or a 31st. Similarly, if the coupon period starts on the last day of February, it is assumed to produce only one day of interest in February as if it was starting on a 30th Feb when the end of the period is a 30th or a 31st, or two days of interest in February when the end of the period is a 29th, or 3 days of interest in February when it is the 28th Feb of a nonleap year and the end of the period is before the 29th. 
A013 
30E3/360 or Eurobond basis model 3 
Method whereby interest is calculated based on a 30day month and a 360day year. Accrued interest to a value date on the last day of a month shall be the same as to the 30th calendar day of the same month. This means that a 31st is assumed to be a 30th and the 28 Feb (or 29 Feb for a leap year) is assumed to be equivalent to a 30 Feb. It is a variation of the 30E/360 (or Eurobond basis) method where the last day of February is always assumed to be a 30th, even if it is the last day of the maturity coupon period. 
A014 
Actual/365NL or Actual/365 No Leap 
Method whereby interest is calculated based on the actual number of accrued days in the interest period, excluding any leap day from the count, and a 365day year. 
OTHR 
Other 
Other method than A001A014. See Narrative. 