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A(n)_________________________ Guarantees the Swap Parties a Specific Rate of Return

Question 4

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A(n)_________________________ guarantees the swap parties a specific rate of return on their credit assets.Bank A may agree to pay the total return on the loan to Bank B plus any appreciation in the market value of the loan.In return Bank A will often get LIBOR plus a fixed spread plus any depreciation in the value of the loan.

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