It provides flexibility to allow, for example, a loan to be divided into fixed and variable rate parts according to the client’s needs. The product is also flexible in terms of time, for example, in the case of a loan, it is not necessary to cover the entire term.

The main properties of the product:

• The variable rate is set (fixed) two working days before the start of the given period, while the interest payment is made at the end of the given period.
• Interest income and interest expenses can be fixed in advance by concluding the transaction.
• It is important that IRS interest periods and frequency of interest payments are consistent with the interest periods and time of interest payments on the base product (loan).
• It can be concluded to cash flows with different maturity (amortization).
• Net settlement, the parties account for the difference between the fixed and variable interest rates.
• A product with a low base collateral and high liquidity.
• It can be closed in whole or in part before the expiration of the transaction at any time by a reverse transaction, the value of which depends on the current interest market environment.
• When you close an interest rate swap early, you may incur a profit or loss depending on current interest rate market developments.
• It can be concluded for a long period of time, up to 20-25 years.

Experts

If you would like to become a client of OTP Global Markets, feel free to contact us.

Useful documents

These documents in English language to the person concerned shall be for information purposes only. OTP Bank Plc shall fulfil its obligations imposed by the legal regulations or requirement of supervisory authority by the documents in Hungarian language.
In the event of any discrepancy between the English language and Hungarian language versions, the Hungarian language version shall prevail.

Information on the suspension of the market making obligation (available only in Hungarian)