excess spread

Learning Objectives: Compute and evaluate one or two iterations of interim cashflows in a three-tiered securitization structure. Describe the treatment of excess spread in a securitization structure and estimate the value of the overcollateralization account at the end of each year. Explain the...

Hi, Mr @David Harper , for the following question, although I get the correct answer, I still doubt on the calculation of excess spread = 0.65% becasue the base of inflow of outflow is different (i.e. 600mn vs 570mn) My calculation is: 600mn*(8.75%-0.60%) - 570mn*(7.5%) rather than 0.65%, do...