A swap in which the floating rate payments are inversely proportional to interest rate movements. The swap structure consists of a reverse floating-rate payment from one party to the swap. In other words, the floating rate payer’s payments vary inversely with interest rates based on a high level fixed rate less a variable rate. An example of a reverse floating-rate swap is an interest rate swap (literally a superfloater swap) where the floating rate payments are linked to a bear spread position in a way that the floating rate payer doubly benefits from any fall in interest rates.

This structure is mainly designed to hedge the effects of a reverse floating rate note (reverse FRN).