fix: if borrow rate is zero, only update the ilk last updated

src/IonPool.sol

@@ -490,14 +490,14 @@ contract IonPool is PausableUpgradeable, RewardToken {
         (uint256 borrowRate, uint256 reserveFactor) =
             $.interestRateModule.calculateInterestRate(ilkIndex, totalDebt, totalEthSupply);
 
-        if (borrowRate == 0) return (0, 0, 0, 0, 0);
-
-        // Calculates borrowRate ^ (time) and returns the result with RAY precision
-        uint256 borrowRateExpT = _rpow(borrowRate + RAY, block.timestamp - ilk.lastRateUpdate, RAY);
-
         // Unsafe cast OK
         timestampIncrease = uint48(block.timestamp) - ilk.lastRateUpdate;
 
+        if (borrowRate == 0) return (0, 0, 0, 0, timestampIncrease);
+
+        // Calculates borrowRate ^ (time) and returns the result with RAY precision
+        uint256 borrowRateExpT = _rpow(borrowRate + RAY, uint256(timestampIncrease), RAY);
+
         // Debt distribution
         // This form of rate accrual is much safer than distributing the new
         // debt increase to the total debt since low debt amounts won't cause

test/unit/concrete/IonPool.t.sol

@@ -1129,6 +1129,52 @@ contract IonPool_InterestTest is IonPoolSharedSetup, IIonPoolEvents {
         }
     }
 
+    // If zero borrow rate, only the last updated timestamp should update
+    function test_CalculateRewardAndDebtDistributionZeroBorrowRate() external {
+        // update interest rate module to have zero rates.
+        IlkData[] memory ilkConfigs = new IlkData[](3);
+        uint16[] memory distributionFactors = new uint16[](3);
+        distributionFactors[0] = 0.2e4;
+        distributionFactors[1] = 0.4e4;
+        distributionFactors[2] = 0.4e4;
+
+        for (uint8 i; i != 3; ++i) {
+            IlkData memory ilkConfig = IlkData({
+                adjustedProfitMargin: 0,
+                minimumKinkRate: 0,
+                reserveFactor: 0,
+                adjustedBaseRate: 0,
+                minimumBaseRate: 0,
+                optimalUtilizationRate: 9000,
+                distributionFactor: distributionFactors[i],
+                adjustedAboveKinkSlope: 0,
+                minimumAboveKinkSlope: 0
+            });
+            ilkConfigs[i] = ilkConfig;
+        }
+
+        interestRateModule = new InterestRate(ilkConfigs, apyOracle);
+        ionPool.updateInterestRateModule(interestRateModule);
+
+        vm.warp(block.timestamp + 1 days);
+
+        (
+            uint256 totalSupplyFactorIncrease,
+            ,
+            uint104[] memory rateIncreases,
+            uint256 totalDebtIncrease,
+            uint48[] memory timestampIncreases
+        ) = ionPool.calculateRewardAndDebtDistribution();
+
+        assertEq(totalSupplyFactorIncrease, 0, "total supply factor");
+        assertEq(totalDebtIncrease, 0, "total debt increase");
+
+        for (uint8 i; i != 3; ++i) {
+            assertEq(rateIncreases[i], 0, "rate");
+            assertEq(timestampIncreases[i], 1 days, "timestamp increase");
+        }
+    }
+
     function test_AccrueInterest() public {
         uint256 collateralDepositAmount = 10e18;
         uint256 normalizedBorrowAmount = 5e18;