U.K. mortgage provider Bradford & Bingley has entered a cross-currency interest-rate swap on the back of a EUR100 million (USD122 million), three-year bond issue with a floating-rate coupon.
The corporate is paying a floating euro rate of three-month EURIBOR plus 8.25 basis points and receiving floating sterling to match its liabilities, which include sterling residential mortgages and secured commercial property loans. "It suits our book," said Paul Rixon, treasurer in Bingley, adding it is standard practice for the company to convert its bond issues into floating sterling, either LIBOR plus or a base rate.
BNP Paribas is the swap counterparty, as well as book runner of the bond, Rixon said, declining to elaborate on why the firm was chosen.
