Bond Tender Offer less than BACV

[EricS-AMIC]

Hello,

We received a bond tender offer that is less than BACV as well as Par (but price is greater than current market price). Looking at SSAP 26R and footnote 7, it seems to suggest in cases of accepting a tender where BACV is greater than consideration received, then the entire difference between consideration received and BACV is reported to invested income.

However, how does this impact life companies and IMR? Guidance seems silent on this. It was our understanding this tender at a loss is still an interest related loss, and therefore should flow through the IMR as any other sale would, but the footnote is leaving us confused.

Would appreciate any feedback. Thank you!