Question
Borrowers with floating rate loans often struggle to make payments when interest rates rise. A bank owns a loan that they are concerned about defaulting.
Borrowers with floating rate loans often struggle to make payments when interest rates rise. A bank owns a loan that they are concerned about defaulting. Which of the following would protect the bank and make a payment to the bank in the event of a default?
- A. CDS
- B. Futures contract
- C. Option contract
- D. Interest rate swap
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Handbook Of Asian Finance Financial Markets And Sovereign Wealth Funds
Authors: David Lee, Greg N. Gregoriou
1st Edition
0128009829, 978-0128009826
