Greece Deal Triggers $3B in Default Swaps: ISDA |
| Bloomberg - Mar 9, 2012 |
Greece’s use of collective action clauses forcing investors to take losses under its debt restructuring triggers payouts on $3 billion of default insurance, the International Swaps & Derivatives Association said.
A total 4,323 credit-default swap contracts may now be settled after ISDA’s determinations committee ruled the use of CACs is a restructuring credit event, according to a statement distributed today by Business Wire. Before the ruling, Greek swaps rose to a record $7.68 million in advance and $100,000 annually to insure $10 million of debt for five years.
Swaps traders will hold an “expedited” auction March 19 to “maximize” the number of bonds that can be used to set payout amounts on the contracts, New York-based ISDA said on the committee’s website today. Auctions, which set a recovery value on the underlying bonds, typically are held about a month after credit events are triggered.
Read Full Article from Bloomberg
- Posted: 2012-03-09 16:00:47
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