#currency-swap #finance
to swap only interest payment cash flows on loans of the same size and term. Again, as this is a currency swap, the exchanged cash flows are in different denominations and so are not netted. An example of such a swap is the exchange of
fixed-rate US dollar interest payments for
floating-rate interest payments in Euro. This type of swap is also known as a cross-currency interest rate swap, or
cross currency swap.
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Currency swap - Wikipedia, the free encyclopediailla interest rate swap) because they are denominated in different currencies. As each party effectively borrows on the other's behalf, this type of swap is also known as a back-to-back loan.[3]Last here, but certainly not least important, is <span>to swap only interest payment cash flows on loans of the same size and term. Again, as this is a currency swap, the exchanged cash flows are in different denominations and so are not netted. An example of such a swap is the exchange of fixed-rate US dollar interest payments for floating-rate interest payments in Euro. This type of swap is also known as a cross-currency interest rate swap, or cross currency swap.[4]
Uses[edit]
Currency swaps have three main uses:
To secure cheaper debt (by borrowing at the best available rate regardless of currency and then swapping for debt in desired currency Summary
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