Coventry Building Society, a U.K. mortgage lender, has entered a foreign exchange swap to convert part of its first five-year EUR500 million (USD574 million) floating-rate note into a sterling-dominated liability. Ian Palmer, risk manager in Coventry, said the thrift decided to issue a euro-denominated note to target a different investor audience.
In the foreign exchange swap, Coventry Building Society pays sterling and receives euros. The coupon on the note is three-month Euribor plus 20 basis points. Palmer declined to reveal the exchange rate it pays and receives in the swap. Dresdner Kleinwort Wasserstein and HSBC were the bookrunners on the note. Palmer declined to name the swap counterparties.
