Cross currency swap

A transaction when one party pays, either on a one-time basis or through instalments, floating or fixed amounts in a given currency calculated based on the notional amount of this currency, and the other party pays, either on a one-time basis or through instalments, floating or fixed amounts in another currency calculated based on the equivalent amount in such other currency.

This product serves as an interest rate or currency risk hedging tool on a long-term basis. It covers exchange of interest payments and the exchange of notional amounts.

Product features

  • Hedging currency and interest rate risks.
  • Zero costs connected with the deal.
  • Flexibility of parameters - easily adjustable to the structure of the underlying asset (loan)
  • Can be sold at any time.

Product variants

  • Initial exchange - exchange of notional amounts at the time of execution.
  • Final exchange - exchange of notional amounts at expiration time.
  • Adjusted Cross Currency Swap - each exchange of interest payments also includes adjustment of the notional amount in one currency depending on the development of exchange rates.