Explanation

The correct answer is B. The Bankers' Trust and Procter & Gamble case involved complex interest-rate derivatives.

Key facts about the Bankers' Trust-P&G case:

• The transaction was a highly complex leveraged interest-rate swap
• P&G entered into two major derivatives transactions with Bankers' Trust in 1993-1994
• The deals were structured as "5/30" swaps (5-year swaps with 30-year embedded options)
• P&G suffered massive losses when interest rates rose unexpectedly
• P&G sued Bankers' Trust, alleging fraud and misrepresentation

Why other options are incorrect:

• A: P&G was not a new client; they had an established relationship with Bankers' Trust
• C: While P&G claimed they wanted hedging, the transactions were highly speculative in nature
• D: Bankers' Trust actually denied having a fiduciary duty to P&G, arguing they were sophisticated counterparties

This case became a landmark in derivatives litigation and highlighted issues around suitability, disclosure, and the responsibilities of financial institutions when dealing with corporate clients.