A swap bank has identified two companies with mirror-image financing needs (they both want to borrow equivalent amounts for the same amount of time.Company X has agreed to one leg of the swap but company Y is "playing hard to get."
A)If the swap bank has already contracted one leg of the swap,they should be anxious to offer better terms to company Y to just get the deal done.
B)The swap bank could just sell the company X side of the swap.
C)Company X should lobby Y to "get on board."
D)If the swap bank has already contracted one leg of the swap,they should be anxious to offer better terms to company Y to just get the deal done,and the swap bank could just sell the company X side of the swap.

Question

Quizplus · Accepted Answer

If the swap bank has already contracted one leg of the swap, they should offer better terms to company Y to get the deal done. Additionally, they could sell the company X side of the swap, allowing them to complete the swap with company Y. This would benefit all parties involved by matching companies with mirror-image financing needs. Company X lobbying company Y or the swap bank offering better terms to company Y alone may not necessarily result in a successful swap.

A Swap Bank Has Identified Two Companies with Mirror-Image Financing