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Porter, White & Company recently completed a swap advisory assignment for the Houston County Health Care Authority in locking in a long-term fixed rate using an interest rate swap. Read more about this transaction and our swap advisory practice on our website.
Bringing Transparency to the Interest Rate Swap Market
While recent market turmoil has hampered liquidity in the market and has caused banks to shy away from aggressively competing for transactions, the need to understand structure and pricing has never been greater. PW&Co successfully assisted Houston County Health Care Authority in negotiating an interest rate swap and brought transparency to the pricing of the transaction.
At the time of this writing, current swap rate levels offer attractive fixed rates by historical comparisons, but the structure of a transaction determines the eventual outcome of a deal, whether it relates to credit exposure to a counterparty, lowering variability of debt service payments, or matching another item on the balance sheet. Understanding the dynamics among the structure of an interest rate swap, economic impact, accounting impact, legal and covenant ramifications, and other risks is essential to an effective derivative transaction.
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