Somebody redeems 1,200 $PUSD for 0.6 $BNB and thus repays 1,200 $PUSD of your debt, reducing it from 3,200 $PUSD to 2,000 $PUSD. In return, 0.6 $BNB, worth $1,200, is transferred from your PiggyBank to the redeemer. Your collateral goes down from 2 to 1.4 $BNB, while your collateral ratio goes up from 125% to 140%(= 100% * (1.4 * 2,000) / 2,000).