Swanand

Swaps, Swaptions, & FRAs use this convention. The reason for it is that the LIBOR term structure is quoted in annualized terms. For example:

180-Day Rate: 6.0% (Actual 180 day rate = 6.0%*(180/360) = 3.0%
360- Day Rate: 7.0% (Actual 360 day rate = 7.0%*(360/360) = 7.0%

You just have to undo the convention for annualizing the rates.