An Interest Rate Derivatives allows you to hedge your interest rate exposures.

Interest Rate Swap- IRS, is an agreement between two counter parties to exchange fixed rate interest payments for floating rate interest payments or vice versa, calculated using an agreed notional principal amount.

The Essentials

• Swaps are contractual agreements to exchange or swap a future stream of cash flows.
• Zero cost.
• Interest rate swaps allow the user to switch their effective liability from floating to fixed and vice versa.
• Cap/Floor strike is negotiable.
• Upfront premium is payable.

Interest rate cap

The Seller of the Cap agrees to compensate the Buyer, whenever a reference interest rate (e.g. LIBOR) exceeds a pre-agreed level (Cap Rate) for a period at specified intervals. Premium is payable upfront and calculated using an agreed notional principal amount.

Interest rate floor

The Seller of the Fllor agrees to compensate the Buyer, whenever a reference interest rate (e.g. LIBOR) fixes below a pre-agreed level (Floor Rate) for a period at specified intervals. Premium is payable upfront and calculated using an agreed notional principal amount.

Eligibility

Any customer who is holding a proper underlying transactions and having a good understanding about products in this nature is eligible to apply for Interest Rate Derivatives.

Please contact the Treasury Dealing Room on +8802 9896048, 9896049 or +8802 9896046, 9896310 for more details