Patent ID: 7860767

Claim:
A method of determining an interest rate to be applied against a debit amount, the method comprising: identifying a plurality of assets held by a borrower to be used as collateral for a loan by the borrower for the debit amount in a collateralized lending transaction between the borrower and a lender, wherein the lender is entitled to take possession of the collateral to satisfy an unpaid amount on the loan, wherein the assets comprise securities; grouping the assets held by the borrower to be used as collateral for the loan, by a computer system, into two or more classes on a daily basis, wherein the classes comprise classes of securities, and wherein the computer system comprises a processor and computer-readable medium; assigning, by the computer system, a daily interest rate to each class of assets on a daily basis; prioritizing, by the computer system, the assets classes on a daily basis, wherein asset classes having a lower interest rate are prioritized higher than asset classes having a higher interest rate; allocating, by the computer system, the debit amount to each of the asset classes on a daily basis based on the prioritization of the asset classes and marginable market values of the assets held in each of the asset classes; calculating, by the computer system, a blended interest rate on a daily basis, the blended interest rate comprising a weighted average of the daily interest rates assigned to the two or more asset classes, wherein the weighted average is determined based on the daily interest rate assigned to each asset class and the ratio of the allocated debit amount for each class to the debit amount; and applying, by the computer system, the blended interest rate to the debit amount on a daily basis to determine an interest accrual amount due on the debit amount.