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A leveraged floater issuer has:

A long position in a normal floating coupon bond (receiving 2f x Notional)
+
A short position in a leveraged floater paying lets say 2L x Notional
+
A swap receiving L x 2 x Notional and paying swap rate x 2 x Notional

Net cash flow = 2 x Notional x (f - swap rate)

Now, becasue the 3 positions are with 3 different counterparties, it is inappropriate to net the credit risk.
A. The issuer faces credit risk from the normal bond issuer.
B. The counterparty of the leveraged floater faces credit risk from its issuer
C. Credit risk in the swap would vary in size and direction depending on the LIBOR term structure through the life of the swap

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