Breakage costs: Difference between revisions
Jump to navigation
Jump to search
Amwelladmin (talk | contribs) (Created page with "Breakage costs , or break costs, on a loan are the opportunity cost to a lender of a borrower repaying a loan before scheduled maturity, meaning the lender mus...") Tags: Mobile edit Mobile web edit |
(No difference)
|
Revision as of 21:53, 12 June 2019
Breakage costs , or break costs, on a loan are the opportunity cost to a lender of a borrower repaying a loan before scheduled maturity, meaning the lender must unwind its interest rate hedges - usually the difference between the rate payable on the loan for the specified period and the overnight rate
swap break costs are the equivalent for a swap, where there are cash flows running in both directions.