A financial intermediarys balance sheet is such that DA= 5, DL= 3. This FI has $300 million in assets and net worth (equity) of $50 million. The CFO points out that there is a 4-year SWAP contract available. This SWAP pays 5% fixed (s.a) against 6-month LIBOR. He also mentions that the duration of 4-year T-Bonds with a 5% coupon (semi-annual) is 3.2 years. What side of the SWAP should the FI pay (floating or fixed) and what should be notional principal of the contract to fully hedge the interest rate exposure?