The Characteristics of a Swap Agreement May Be Best Described

The characteristics of a swap agreement may be best described as:

A) an agreement in which companies agree to exchange their shares as part of a merger or company acquisition arrangement. The swap provides certainty for the shareholders in both companies as to the timing and relative weighting of the shares in the swap. Swaps must be registered with the stock exchange.
B) an agreement in which lenders exchange portfolios of loan receivables in order to better balance their risks. This is an especially important facility for small banks that may face higher risk exposures as a result of concentrating their loan receivables in a small or niche market.
C) an agreement in which borrowers exchange aspects of their respective loan obligations. Two types of swaps that are commonly used are interest rate swaps and foreign currency swaps. Swap agreements are derivative financial instruments.
D) an agreement in which investors agree to swap entitlements to dividends but retain ownership of the underlying share. This allows traders in the market to make contracts that result in high cash dividends as well as high capital returns on shares.