Ireland Swaps at Record as Allied Signals 63% Chance of Default

The cost of insuring Irish sovereign debt surged to a record as credit-default swaps on Allied Irish Banks Plc subordinated debt signaled a 63 percent probability of default within five years.

Contracts insuring 10 million euros ($14 million) of Allied Irish’s junior bonds cost about 3.35 million euros upfront and 500,000 euros annually, according to data provider CMA. That’s up from 400,000 euros a year in April. Swaps on the government’s debt jumped 36.5 basis points to 554.5.