Creditex and Markit, in partnership with 14 major credit derivative dealers, today determined a price to facilitate the settlement of credit derivative trades referencing the senior debt of Landsbanki Islands hf in Europe’s first ever Credit Event Auction.
At 2:00 pm GMT today, the final price for Landsbanki senior debt for the purpose of settling credit derivative transactions was determined to be 1.25%.
The auction was conducted in accordance with the International Swaps and Derivatives Association (ISDA) 2008 Landsbanki CDS Protocol. Creditex and Markit are the official administrators of Credit Event Auctions.
The Credit Event Auction enables market participants to cash settle credit derivative transactions. During a Credit Event Auction, dealers submit orders electronically on the Creditex platform. The auction submissions are delivered to Markit electronically. Markit calculates and verifies the results, and publishes them on www.creditfixings.com.
At 3:45 pm GMT today, the results of an auction to determine the final price for Landsbanki subordinated debt for the purpose of settling credit derivative transactions will be published on www.creditfixings.com.
Creditex and Markit will conduct Credit Event Auctions to facilitate the settlement of CDS contracts referencing Glitnir Banki hf on November 5 and Kaupþing Banki hf on November 6.
The Credit Event Auction process was launched in 2005 by Creditex and Markit in collaboration with ISDA and major credit derivative dealers. Auctions have been held to facilitate settlement of credit derivative trades referencing Washington Mutual Inc., Lehman Brothers Holdings Inc., Federal National Mortgage Association, Federal Home Loan Mortgage Corporation, Tembec Industries Inc., Quebecor World Inc., Movie Gallery, Collins & Aikman, Delta Air Lines, Northwest Airlines, Delphi Corporation, Calpine Corporation, Dana Corporation and Dura.