What is ranking ratio in SAP (FS-CMS - Collateral Management System)?

SAP Term: ranking ratio

• Component: FS-CMS

• Component Name: Collateral Management System

• Description: A collateral agreement can be divided into several portions and each presents a contribution or percentage share in the total value of the collateral agreement. The parts of a collateral agreement are placed in a ranking ratio. The ranking ratio describes describes in which order in case of a fictitious utilization the the individual portions of the collateral agreement will be used.

Smart SAP Assistant

• Key Concepts: 
  Ranking ratio is a feature of the FS-CMS Collateral Management System (CMS) that allows users to assign a numerical value to each collateral item in order to prioritize them. This numerical value is referred to as the ranking ratio and it is used to determine which collateral items should be used first when a loan is being processed. 
  
  How to use it: 
  The ranking ratio can be set by the user in the CMS. The user can assign a numerical value from 1-10, with 1 being the lowest priority and 10 being the highest priority. The higher the ranking ratio, the higher priority the collateral item will have when processing loans. 
  
  Tips & Tricks: 
  When setting the ranking ratio, it is important to consider the type of collateral item and its importance in relation to other collateral items. For example, if a loan requires two pieces of collateral, one of which is more important than the other, then it would be wise to assign a higher ranking ratio to the more important collateral item. 
  
  Related Information: 
  The ranking ratio feature of FS-CMS CMS is closely related to other features such as collateral selection and loan processing. It is important to understand how these features work together in order to effectively use the ranking ratio feature. Additionally, understanding how different types of collateral items are ranked can help users make better decisions when setting the ranking ratio.