Minimize your interest rate risk while managing interest rate income and cost to business.
Interest rate option is a financial contract between two parties that provides an interest rate cap or floor on the floating rate income or payment. This will help you to reduce the cost of interest when the interest rate goes up or to guarantee the interest rate return when the interest rate goes down.
Product Use Cases
- Investors use caps and floors to hedge against the risks associated with floating interest rates.
- Interest Rate Cap is frequently purchased by issuers of floating rate debt who wish to protect themselves from higher financing costs resulting from a rise in interest rates.
- Interest Rate Floor is frequently purchased by purchasers of floating rate debt who wish to protect themselves from the loss of income that would result from a decline in interest rates./li>
Product Benefits
- Hedge against interest rate volatility risk.
- Manage costs and returns in line with market conditions. For example, if the interest rate is trending down, the customer may consider buying an interest rate floor to protect the interest rate return. If the interest rate is trending up, the customer may consider buying an interest rate cap to limit the cost of interest.
Service Conditions
- Derivative transactions are subject to a credit limit.
- Transactions must comply with Bank of Thailand regulations.
- Payment upon product features and specifications must be made when the transaction reaches the due date.
- An amendment or cancellation of a transaction amendment prior to maturity may be subject to a fee.
Documents Download
This Website uses cookies to provide you with the best experience and to improve the Bank’s website services in order to better serve your requirements. You can find the details about cookies use on
Cookies Policy
