EFTA02460213.pdf

From: jeffrey E. <[email protected]> Sent: Monday, June 6, 2016 5:19 PM To: Shahzad Shahbaz; labor Y. - =C2 Credit lines at many banks floor the floating index at 0%. With 1-month Euribor fixing at -0.25%, the benefit of negativ= interest rates can be used to your advantage. - =C2 You can bypass the floor by borrowing in USD at 1-month Libor (plus a spread) and using a cross-currency swap to create a synthetic EUR loan. The cross currency basis swap pays USD Libor and you pay -0.35% (so 35bps actually get paid to you as it is negative). This allows you to not only capture the benefit of negative rates but also cheapen the funding bythe cross-currency differential in the market. theerfore - =C2 By creating a synthetic EUR loan via cross-currency swaps, you can reduce funding costs of Sheik Hamad by roughly 60 bps for 2 year= (combination of savings from negative Euribor rates and negative cros=-currency basis). please note The information contained in this communication is confidential, =ay be attorney-client privileged, may constitute inside information, an= is intended only for the use of the addressee. It is the property ofIEE Unauthorized use, disclosure or copying of this communication o= any part thereof is strictly prohibited and may be unlawful. If you ha=e received this communication in error, please notify us immediately by=br>return e-mail or by e-mail to [email protected] <mailto:[email protected]> , and destroy this communicat=on and all copies thereof, including all attachments. copyright -all ri=hts reserved EFTA_R1_01565703 EFTA02460213