notional principal

See notional amount. American Banker Glossary

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   The hypothetical amount on which interest payments are based in products such as interest rate swaps, forward rate agreements, caps and floors.
   ► See also Cap, FRA, Floor, Swap.

Financial and business terms. 2012.

Look at other dictionaries:

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  • notional amount — USA The amount on which the payments of the parties to a derivatives contract are based, usually used in the context of swaps, such as currency swaps and interest rate swaps. The amount is notional because there is no actual exchange of principal …   Law dictionary

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