can you please explain how thos works?

Figure 23.10 Company Primo.1.SN Boating floating P .IN ang fed Debt market Debt market Company A borrow is and was for a 15 fed rate Company borrows 9.55 flowed andre for a prime plus 1.5% floating rate F4610 Tian Hun Example: Interest Rate Swap Loudon Intan Barka Consider the following interest rate swap 7 Company A can borrow from a bank at 8% fixed or LIBOR + 15 floating (borrows Company B can borrow from a bank at 9.5% fixed er LIBOR +.5% (borrows floating) Company A prefers floating and Company B prefers fixed . By entering into a swap agreement, both A and B are better off than they would be borrowing from the bank with their preferred type of loan, and the swap dealer makes .5% Net -LIBOR Company A Swap Dealer w/A Company B Swap Dealer w/B Swap Dealer Net Pay LIBOR 5% 8.5% 9% LIBOR +.5% LIBOR + 9% Receive 8.5% LIBOR + 5% LIBOR + 5% LIBOR + 9.5%