Bank Credit Worst to Companies Since Crisis Peak: Credit Markets
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The debt of banks is trading at the biggest discount to the broader corporate bond market since the depths of the funding squeeze in November as Europe’s sovereign crisis again threatens to rattle global financial markets.
From Spain’s Banco Santander SA to Morgan Stanley in New York, the cost of credit-default swaps on a basket of the largest banks in Europe and the U.S. is 266 basis points, compared with 137 for the Markit iTraxx Europe Index of 125 companies with investment-grade ratings. The 129 basis-point spread is the most since it reached 133 on Nov. 30.