IRS RUB 3Y Act/Act Ann Fixed vs 3M MOSPRIME mid

The Mosprime rate (Moscow Prime Offered Rate) is an indicative offered rate for RUB-denominated loans (deposits) on the Moscow interbank market. It is calculated by the National Finance Association (NFA) and serves as a key benchmark for the cost of short-term unsecured borrowing for leading banks. RUB Mosprime 3M Mid is the midpoint between the bid and offer rates for 3-month ruble loans. An Interest Rate Swap (IRS) on the Mosprime rate is a derivative financial instrument whereby one party (the fixed-rate payer) agrees to make periodic payments at a predetermined fixed interest rate. In return, it receives payments from the other party (the floating-rate payer) calculated based on the floating RUB Mosprime 3M rate. Both series of payments are calculated on a notional principal amount, which is not exchanged between the parties. Such a swap allows market participants to manage interest rate risk by locking in a borrowing cost or, conversely, speculating on the future direction of floating rates. In practice, the parties typically exchange only the net difference between the fixed and floating payments.