Spread over the reference rate
The margin a floater pays above its chosen benchmark — the key rate, RUONIA or RUSFAR.
How to read the number
The margin is fixed at placement and reflects the issuer's credit standing at that moment. The base floats afterwards; the margin does not.
When the metric lies
If credit quality deteriorates, the fixed margin stops covering the risk. What equalises it is the price: the floater drifts below par.
Also known as: quoted margin, discount margin