Two companies want to establish a swap contract with each other. What is a realistic option to form the contract using an intermediary bank? Borrower A gains 0.4%, borrower B gains 0.2% and bank gains 0.2%.
Added by Bryan C.
Step 1
Step 1: Use a tri-party/intermediary-banked arrangement (back-to-back or parallel legs) where one bank acts as the central intermediary (swap dealer) and posts two opposite legs to each company. Show more…
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