Swap

Through swap agreements we give customers a chance to effectively manage their cashflows and risks by minimizing their borrowing costs.

  • Currency Swaps
  • Interest Rates Swaps
  • Cross Rate Swaps

Currency Swap

  • A currency swap is a contract in which the parties agree that cash flows denominated in two different currencies will be exchanged (“swapped”) at a stipulated date or for a stipulated period of time at the exchange rate currently then in effect.
  • Currency swaps bear no exchange rate risk but are exposed to interest rate risk.
  • Currency swaps are typically used to reduce borrowing costs and/or to normalize cash flows without incurring exchange rate risk.

Interest Rate Swap

  • An interest rate swap is a contract in which the parties agree to exchange the interest cash flows on debts denominated in the same currency by converting a fixed to a variable rate or vice-versa. Interest rate swaps provide an effective way of managing interest rate risk.
  • In an interest rate swap there is no exchange of principal: only the interest cash flows generated on them are exchanged.

Cross Currency Swap

  • "A cross currency swap is a contract that combines the features of both an interest rate and a currency swap.

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