problem 8) Companies A and B have been offered the following rates per annum on a $40 million four year loan: Company A: Company B: Fixed rate 6.0% 7.8% Floating rate LIBOR - 1.1% UBOR - 3.7% Company B requires a floating rate loan; Company Arequires a fixed-rate Loan Design a swap that will net a bank, acting as intermediary, 0.3% per annum and that will appear equally attractive to both companies (10 points) [Problem 9-10) 1) Company XXX has been offered the rates shown in the following Table. It can invest for five years at 6.8%. What floating rate can it swap this fixed rate into? (4 points) LIBOR + or Basis Points 2) Company YYY has been offered the rates shown in the following Table. It can invest for ten years at LIBOR plus 170 basis points. What fixed rate can it swap this floating rate into? (4 points) Bid and offer fixed rates in the swap market; Payments exchanged semiannually Maturity (Years) Bid Offer 6.74 6.94 | 10 7. 44 7 .88 problem 8) Companies A and B have been offered the following rates per annum on a $40 million four year loan: Company A: Company B: Fixed rate 6.0% 7.8% Floating rate LIBOR - 1.1% UBOR - 3.7% Company B requires a floating rate loan; Company Arequires a fixed-rate Loan Design a swap that will net a bank, acting as intermediary, 0.3% per annum and that will appear equally attractive to both companies (10 points) [Problem 9-10) 1) Company XXX has been offered the rates shown in the following Table. It can invest for five years at 6.8%. What floating rate can it swap this fixed rate into? (4 points) LIBOR + or Basis Points 2) Company YYY has been offered the rates shown in the following Table. It can invest for ten years at LIBOR plus 170 basis points. What fixed rate can it swap this floating rate into? (4 points) Bid and offer fixed rates in the swap market; Payments exchanged semiannually Maturity (Years) Bid Offer 6.74 6.94 | 10 7. 44 7 .88