(Interest rate swap. 4 of 4) Company A wants to finance a $100,000,000 project at a fixed rate for 5 years. Company B wants to finance a $100,000,000 project at a floating rate for 5 years. Their external borrowing opportunities are given below. Assume a swap bank is quoting five-year dollar interest rate swaps at 8.8- 9.0 percent against LIBOR flat. What is the value of this swap to the swap bank? Credit Rating Fixed-Rate Borrowing Cost Floating Rate Borr Company A A 10.3% LIBOR+1% Company B AA 8.9% LIBOR+0.5% The swap bank will earn LIBOR per year. The swap bank will earn 20 basis points per year on $100,000,000 - $200,000 per year. The swa: ank will earn 1 basis points per year on $100,000,000 = $10,000 per year. The swap bank will lose money on the deal. The swap bank will break even