An ETI with euro liquidity is not limited to an investment in EUR. It can convert part (or all) into USD, cover its foreign exchange exposure and invest in dollars when the yield/risk torque is more favourable. Below, two usage cases illustrated with your data (unchanged).

Use case 1 — 10 M€ to be placed over 6 months

Bank assumptions

• Offer in EUR : 3,15 %

• Offer in USD: 5,10 % (with currency risk protection)

Market data

• ESTR 6 months: 3,07 %

• SOFR 6 months: 5,25 %

• EUR/USD spot: 1,17

• EUR/USD at 6 months (term): 1,18

Option A — Direct placement in euros

• Amount placed: 10 000 000 €

• Annual rate: 3,15 % → 1,575 % 6 months

• Interest: 157 500 €

• Final amount: 10 157 500 €

Option B — Dollar placement with currency cover

• Initial conversion: 10 000 000 € → 11 700 000 $ (spot 1,17)

• Annual rate USD: 5,10 % → 2,55 % 6 months

• Interest: 298 350 $

• Total: 11 998 350 $

• Conversion to maturity 1,18 : 10 169 921 €

Net profit in euro

• Total gain: 10 169 921 € – 10 000 000 € = 169 921 €

• About 12 400 € more than a direct investment in euros.

Conclusion
By placing your euros in dollars with foreign exchange cover, you get about 170 000 € of earnings in 6 months, higher than the traditional placement in euro over the same period.

Use case 2 — Place Euros while financing in dollars

Situation

• Cash available: 5 M€

• Funding requirement: 8 M$ on 3 years

Offers and markets

• Credit offer USD: 5,40 % per year

• ESTR 3 years: 3,56 %

• SOFR 3 years 4,88 %

Recommended approach

• Place cash in EUR at a competitive rate.

• Borrow in USD where the actual cost (covered) is less than the alternative in EUR.

Benefit
Objective arbitration between contracts EUR and USD avoids extra cost over the duration of the loan — potentially several hundred thousand euro — while controlling the exchange risk thanks to the cover.