In the US, an interest rate swap in which the floating rate leg is referenced to the Cost of Funds Index (COFI). The COFI is an interest rate index generally used as an adjustable rate mortgage index, especially with savings institutions as counterparties. The COFI rate is sometimes used as a reference rate in swaps and bonds, especially when shot-term rates are expected to move down, because the COFI rate tends to lag short-term rates.