Illya Gerasymchuk
Entrepreneur / Engineer
the bank's only option now is to sell the UST bond they hold at the market price, and use the proceeds to settle the 1.5% semiannual coupon liability
now the bank has an issue - the 1.5% liability payment is in 6 months, while 4% yield from the asset financed by that liability only gets paid in 1 year while the bank will have the money to pay in the future - it doesn't have it now