Realized through an interest rate and currency swap

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Reference no: EM131616734

Consider this scenario: An American company would like to borrow fixed-rate yen. They can borrow fixed-rate yen at 5.4% or floating-rate dollars at LIBOR + 1.24%. There is also an Asian company who would like to borrow floating-rate dollars. They can borrow fixed-rate yen at 5.8% or floating-rate dollar at LIBOR +1.7%. What is the total cost savings which can be realized through an interest rate/currency swap between the two.

Reference no: EM131616734

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