Swaps In April 2017, consulting firm Booz Allen Hamilton announced it had signed an interest rate swap. The interest rate swap effectively converted $150 million of variable rate debt at LIBOR for...

Swaps In April 2017, consulting firm Booz Allen Hamilton announced it had signed an interest rate swap. The interest rate swap effectively converted $150 million of variable rate debt at LIBOR for payments at 1.963 percent. Why would Booz Allen Hamilton use a swap agreement? In other words, why didn’t the company go ahead and issue fixed rate bonds because the net effect of issuing floating rate bonds and then doing a swap is to create a fixed rate bond?