Interest rate swap is an agreement between Agribank and other financial institutions on exchange flexible interest rate to receive fixed interest rate on a certain money amount. This service is applicable to financial institutions and non financial institutions.
Generally, each party’s money amount
is netted and the different amount will be paid by the party having more debt.
Interest rate swap is decided based
on the movement of the market and is the reflection of fixed interest rate
accepted by the market to change the amount payable for flexible interest rate.
In a normal Interest rate swap
contract, flexible interest rate will be fixed several days before interest
Interest rate will be fixed on an
early defined day and payment will be made on the last day of the term (…)
Interest rate swap is to prevent
interest risk, meet the demand of liquidity and to regulate capital source in
the short term.
Transaction will be rapidly
completed through Reuters system, fax, SWIFT or inter-bank electric remittance
because Agribank is the member of banking association with 10-year experience
of joining inter-bank.
Director of Agribank’s Operations
Centre defines transaction limit applicable to FX Department of Agribank’s
Operations Centre and each of its officers
Transaction principle: safe,
effective, subject to FX dealing limit and ensure liquidity of the Agribank and
maintain foreign currency balance adapted to the Sate bank’s rule for a certain