A “plain vanilla”, fixed-to-fixed foreign exchange or currency swapis an exchange of the principal and interest payments on a similar loan in asecond currency. The first such swap, between IBM and the World Bank, was donein 1981. Since then the swap market has grown to over $1 trillion and, in theprocess, has evolved several additional types of the principal and interestpayments on a variable rate loan in another currency. Similarly, there arecross-currency, floating-to-floating-rate swaps that involve the exchange offloating obligations in different currencies.