On maturity of the futures contracts, a standardized euro-denominated interest-rate swap
with the corresponding maturity and a fixed interest rate against a variable six-month Euribor rate will be delivered.
Trading on the Swedish interest-rate swap
market averaged daily about $12 billion during April 2007 according to the Bank for International Settlements.
One common way to do that is to put on an interest-rate swap
that lengthens the duration of the plan's assets to bring it closer to the duration of the liabilities.
2002-71 addressed a situation in which an interest-rate swap
hedged only a portion of the debt instrument's entire term.
Like most engineers, Rice, when asked to define derivatives in general and the basic concept of a fixed-to-floating interest-rate swap
in particular, literally draws a picture of the transaction on a napkin--his engineering background coming into play, he says.
For example, a company needing fixed-rate financing may choose to issue variable-rate debt converted to a fixed-rate exposure by executing an interest-rate swap
, which requires the company to make periodic fixed payments and receive periodic floating rate-based payments.
Thus, for example, an interest-rate swap
used to hedge another interest-rate swap
would not be a hedging transaction (unless the taxpayer is a dealer in swaps).
--If you think rates are more likely to rise during your borrowing period, an interest-rate swap
to create a "synthetic" fixed rate for your outstanding debt is a good hedging strategy.
The ratings are based on the quality of the student loan portfolio, the credit enhancement within the trust, an interest-rate swap
provided by UBS AG (rated 'AA+/F1+' by Fitch) and the sound legal structure of the transaction.
The district plans to enter into an interest-rate swap
agreement for the 2005C bonds and purchase an interest-rate cap for the 2005D bonds.
The Financial Services Authority (FSA) said Santander UK, Allied Irish Bank, Bank of Ireland, the Co-operative Bank and Clydesdale and Yorkshire banks had agreed to adopt the same approach being used by the UK's biggest banks in offering redress to firms mis-sold interest-rate swaps
Fitch believes the use of floating-rate debt by hospitals and health care systems will continue to grow over the long term as a result of more sophisticated asset/liability strategies and the growing acceptance of and comfort with interest-rate swaps
by health care management and boards.