Exam 15: Swap Markets

If a financial institution that has more rate-sensitive liabilities than assets negotiates a rate-capped swap, its ____ payments will be capped, and it will ____ an up-front premium in exchange for the cap.

Financial institutions such as U.S. savings institutions and commercial banks traditionally had fewer interest rate-sensitive ____ than ____ and therefore were adversely affected by ____ interest rates.

An interest rate collar involves the ____ of an interest rate cap and the simultaneous ____ of an interest rate floor.