Interest rate swap

An interest rate swap is suitable for customers who want to know their interest expenses over the coming years in advance and hedge against a potential rise in the interest rate level.

Interest rate swap Features Terms and conditions Interest rate swap

Interest rate swap

An interest rate swap is used to fix the interest rate on floating-rate loans, such as loans linked to Euribor rates.

An interest rate swap is a contract between the bank and the customer, in which the customer typically pays interest linked to a fixed interest rate to the bank, and the bank pays the customer interest linked to a floating interest rate. This arrangement allows the customer to pay, in practice, a fixed interest on its loan instead of a floating interest.


Your benefits

  • Hedges against rising interest rates and provides certainty over the amount of the monthly loan payment.
  • The fixed interest rate remains the same over the entire contract period.
  • A single interest rate swap can be used to hedge a single loan or several loans.


Remember these

  • Lower interest rates will not mean lower interest expenses.
  • Early cancellation of the contract will always be based on the market price, meaning that one of the parties must compensate the other.
Features

Features

An interest rate swap is used to fix the interest rate on floating-rate loans, such as loans linked to Euribor rates.

An interest rate swap is a contract between the bank and the customer, in which the customer typically pays interest linked to a fixed interest rate to the bank, and the bank pays the customer interest linked to a floating interest rate. This arrangement allows the customer to pay, in practice, a fixed interest on its loan instead of a floating interest.

Terms and conditions

Terms and conditions

Purchasing the products requires a customer relationship and a general agreement on derivatives with Nordea. Please contact our specialists for further information. We will be happy to help.

Interest rate hedging

 

Interest rate fluctuations generate a risk

You can hedge against the risk with different hedging products.

 

Hedge against rising interest rates

Companies can choose among different interest rate hedging products available for various needs.