You have the following information for ABC bank:

ABC wishes to engage in a swap with a notional principal of $$100$ million to reduce its RS gap.

A swap is available where the fixed rate is $7\mathrm{.}5\%$ and the variable payment is Libor $+90BP.$ If

Libor is initially $5\%,$ what is ABC's initial liability funding cost RATE with and without the

swap if you count the swap payment side as an effective liability?