Strategic Use of Interest Rate Swaps for Corporate Debt Management
Interest Rate Swaps (IRS) remain a cornerstone of global finance, dominating the Over-The-Counter derivatives market. For CFOs and treasurers, these instruments are not just hedges but strategic levers to optimize borrowing costs, stabilize cash flows, and reshape balance sheets. By swapping interest payment streams, firms can navigate volatile rate environments and fuel expansion.
The seven key strategies include locking in budget certainty by converting variable-rate debt to fixed payments, exploiting cost arbitrage opportunities, and aligning assets with liabilities. These moves empower high-growth companies to control debt expenses, mitigate risks, and unlock capital for strategic deployment.