UBS Sells Largest Structured Note Tied to Venezuela Since 2009
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UBS AG sold the largest structured note tied to Venezuela in five years, offering a yield of almost 14 percent as political upheaval triggered a jump in the nation’s corporate credit risk.
The Swiss bank sold $65 million of securities linked to the debt of Petroleos de Venezuela SA, according to data compiled by Bloomberg. The cost of insuring $10 million of the company’s bonds against default for five years jumped to $3.4 million in advance and $500,000 annually this week, according to CMA prices for credit-default swaps, compared with $3 million upfront at the start of the year. The contracts signal a 66 percent probability of default.