AMORTISING
- A description, applicable to a variety of instruments, denoting that the notional principal decreases successively over the life of an instrument, eg, amortising swap, index amortising rate swap, amortising cap, amortising collar, amortising swaption. If the decrease takes place in increments, the instrument may be known as a step-down. Mortgage-style amortisation refers to an amortising swap such that the principal amortisation plus interest is the same amount in each interest period.