Dealers dip toe into Sonia swaptions market
NatWest and HSBC print trades, Barclays offers prices
In another milestone for the sterling market’s Libor transition, at least two banks have traded Sonia-linked swaptions and a third is actively showing prices for the instruments.
NatWest Markets is understood to have executed a trade last month to hedge a balance-guaranteed swap – a transaction in which the swap notional reduces at a rate linked to the amortisation of a reference security.
The trade was physically settled, meaning users are left with a Sonia swap if the option is exercised at
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