Company a requires a floating-rate loan company b requires


Question: Company A and B have been offered the following rates per annum on a $20 million five year loan:


Fixed rate

Floating rate

Company A

5.5%

LIBOR + 1%

Company B

6.25%

LIBOR + 1.25%

Company A requires a floating-rate loan; company B requires a fixed-rate loan. Design a swap that will appear equally attractive to both companies.

Request for Solution File

Ask an Expert for Answer!!
Finance Basics: Company a requires a floating-rate loan company b requires
Reference No:- TGS02591566

Expected delivery within 24 Hours