Markit and Creditex, in partnership with 10 major credit derivative dealers, today announced the results of a Credit Event Auction that determined a price to facilitate settlement of credit derivative trades referencing Hawaiian Telcom Communications, Inc. loans.
At 2:00 pm ET today, the final price of Hawaiian Telcom loans was determined to be 40.125% for the purpose of settling loan-only credit derivative transactions.
The auction was conducted in accordance with the Hawaiian Telcom LCDS Settlement Terms published by the International Swaps and Derivatives Association (ISDA) and Markit. Markit and Creditex are the official administrators of Credit Event Auctions.
Credit Event Auctions enable 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.
The Credit Event Auction process was launched in 2005 by Markit and Creditex in collaboration with ISDA and major credit derivative dealers. Since then, Markit and Creditex have conducted 26 Credit Event Auctions, including Hawaiian Telcom, and the process has become an integral part of the CDS market’s infrastructure.