Canara Bank sells a 1 4 FRA on April 1 with a principal amount of INR 5 million at an AR of 8%. The RR on the FRA is the MIBOR, and the cost of the loan is MIBOR + 100. On the settlement date, which is one month ahead, the MIBOR is 6.4% and the RR is MIBOR + 100. A year is said to have 360 days. What will be the settlement payment?

Answer rating: 100% (QA)

Information FRA Type 1 x 4 1 month forward starting April 1 Principal Amount P INR 5 million Annuali... View the full answer