Finmeccanica Default Swaps Extend Surge to 31-Month High
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The cost of insuring against default by Finmeccanica SpA soared to the highest in 31 months, extending yesterday’s increase after the Italian defense company said it faces “structural problems.”
Credit-default swaps on Finmeccanica jumped 17 basis points to 295, according to CMA. That’s the highest since January 2009 and the biggest weekly increase since December 2008, when the contracts peaked at 452.5 basis points. Relative yields rose on the Rome-based company’s bonds, which are rated BBB by Standard & Poor’s and A3 by Moody’s Investors Service.