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Floater |
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Floater A bond whose interest rate varies with the interest rate of another debt instrument, e.g., a bond that has the interest rate of the Treasury bill +.25%.
Floater Informal for a floating-rate note (FLN). A bond with a variable interest rate. These bonds typically have coupons renewable every three months and pay according to a set calculation. For example, a note may have an interest rate of "EURIBOR + 1%" and pay whatever the EURIBOR rate happens to be at the time plus 1%. Some FRNs have maximum and minimum interest rates, known as capped FRNs and floored FRNs, respectively. An FRN with both a maximum and a minimum interest rate is called a collared FRN. In the United States, government-sponsored enterprises issue most FRNs, while banks do the same in Europe. See also: Adjustable-rate mortgage. How to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit webmaster's page for free fun content. |
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FLX Series floaters can be equipped with either a FLX810 Flex-Air applicator of a FLX610 liquid system. To date, Heller's Credit enhancement opportunities have generally taken three forms: 1) converting high fixed-rate tax free bonds to low floaters to significantly reduce debt service; 2) providing aggressive leverage for the acquisition of projects driven by the benefits of inexpensive low floater financing; and 3) re-enhancing existing projects based on based on today's economics, given the previous enhancer's willingness to accept a discount. Inverse floaters are unusual instruments because their interest coupons float in the opposite direction of interest rates in general. |
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