Interest Rate Risk Management

We can manage your company's interest rate risk so you can focus on your business.

Corporate Rate Risk Management

Fluctuating markets can impact your business' bottom line – suddenly and unexpectedly.

In today’s marketplace, interest rate volatility and the uncertain cost of future borrowings have made interest rate risk management an important tool for lenders.

We help develop and implement hedging solutions that minimize or eliminate risks related to the movement of interest rates. This allows customers the financial freedom to focus their efforts on running their business – instead of on the direction of interest rates.

Products offered (minimum of $500,000):

Interest Rate Swaps

  • An interest rate swap is a contractual agreement between two parties to exchange interest payments on set dates in the future. The most common type of swap – called a “plain vanilla” swap – involves one party, the fixed rate payer, making fixed payments, and the other party, the floating rate payer, making payments which depend on the floating interest rate index.

Interest Rate Caps

  • Limits impact of a dramatic rate increase by placing a maximum value on a floating interest rate.
  • Allows the customer to take advantage of low short-term interest rates.

Interest Rate Collars

  • Collar buyer purchases a cap to limit the maximum interest rate to be paid, then sells a floor to obtain a premium to offset all or part of the cap costs.
  • With a collar, the customer forgoes any benefits associated with a decrease in rates below an established floor level.
  • Customer floats within an interest rate band.

Benefits

  • Help to effectively manage or eliminate interest rate risk
  • Provides tremendous flexibility over traditional fixed rate financing
  • Two-way prepayment penalty, providing the customer with a benefit if rates increase
  • Detailed reporting provided online, via fax, email or U.S. mail.
  • Independent approach to the market because we are not making investments

For more information, contact the Interest Rate Risk Management / Corporate Derivatives at 1-800-833-2706, Monday to Friday, 8:00 a.m. to 5:00 p.m. ET.

Huntington Capital Markets® is a federally registered service mark and a trade name under which the investment banking products and services of Huntington Bancshares Incorporated and its subsidiaries, Huntington Securities, Inc. and The Huntington National Bank, are marketed. Securities products and services are offered by licensed securities representatives of Huntington Securities, Inc., registered broker-dealer, member FINRA and SIPC. Banking products and services are offered by The Huntington National Bank, member FDIC.

Huntington Capital Markets personnel may be dual employees of both HSI and HNB. Certain non-public information that you share with Huntington Capital Markets personnel may be shared between HSI and HNB. Such information will not be shared or otherwise disclosed outside our organization without your express permission. HSI and HNB adhere to established procedures to safeguard such information from areas within our organization that trade in or advise clients with respect to the purchase and sale of securities.

Investment and Insurance products are:
NOT A DEPOSIT • NOT FDIC INSURED • NOT GUARANTEED BY THE BANK • NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY • MAY LOSE VALUE

HSI and HNB do not provide accounting, legal, or tax advice; you should consult with your accounting, legal, or tax advisor(s) on such matters.