SCHEDULECalculation of the Annual Percentage Rate of Charge

Regulation 5

1

The annual percentage rate of charge (“APR”) is calculated by means of the equation in paragraph 2 which equates, on an annual basis, the total present value of drawdowns with the total present value of repayments and payments of charges.

2

The equation referred to in paragraph 1 is—

∑k=1mCk(1+X)−tk =∑l=1m'Dl(1+X)−Sl math

where

  • X is the APR;

  • m is the number of the last drawdown;

  • k is the number of a drawdown, thus l ≤ k ≤ m;

  • Ck is the amount of drawdown k;

  • tk is the interval, expressed in years and fractions of a year, between the date of the first drawdown and the date of each subsequent drawdown, thus tl = 0;

  • m’ is the number of the last repayment or payment of charges;

  • l is the number of a repayment or payment of charges;

  • Dl is the amount of a repayment or payment of charges;

  • Sl is the interval, expressed in years and fractions of a year, between the date of the first drawdown and the date of each repayment or payment of charges.

3

For the purposes of paragraph 2—

a

the amounts paid by both parties at different times shall not necessarily be equal and shall not necessarily be paid at equal intervals;

b

the starting date shall be that of the first drawdown;

c

intervals between dates used in the calculations shall be expressed in years or in fractions of a year;

d

a year is assumed to have 365 days (366 days for leap years), 52 weeks or 12 equal months;

e

an equal month is assumed to have 30.41666 days (365/12) regardless of whether or not it is a leap year;

f

the result of the calculation shall be expressed with an accuracy of at least one decimal place; if the figure at the following decimal place is greater than or equal to 5, the figure at that particular decimal place shall be increased by one;

g

the equation can be rewritten as set out in sub-paragraph (h) using a single sum and the concept of flows (Ak), which will be positive or negative, either paid or received during periods l to n, expressed in years;

h

the equation referred to in sub-paragraph (g) is—

S=∑k=1nAk(1+X)−tk math

S being the present balance of flows; if the aim is to maintain the equivalence of flows, the value will be zero.