MECHANISM AND ACCOUNTING TREATMENT OF INTEREST RATE SWAP

Original scientific paper
Autor: dr Danica Prošić
JEL: E43, G23, M41
doi: 10.5937/bankarstvo1501026P
SCINDEX

Summary: Interest rate swap is a derivative which is today routinely used in the financial sector worldwide. As opposed to that, the swap market in Serbia is reduced to basic versions of interest rate swaps only, and is limited to the major users and providers of services in the financial market. Banks in Serbia have been introducing and promoting interest rate swaps as one of their services rather slowly, which can be deduced from various information on interest rate swaps and non-innovative offers of these instruments. On the other hand, companies are unable to recognize interest rate swaps as instruments of hedge against the negative effects of interest rate fluctuations, and a way to gain competitive edge in relation to other market participants.

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