Dealer auction settles Ecuador debt at 31.375%

Dealers today took part in an auction to settle of credit derivative trades referencing Ecuador debt. This marks the first time that a credit event auction has been run to settle CDS referencing debt of a sovereign nation or an emerging market credit.

At 2pm in New York, the final price of Ecuador bonds was determined to be 31.375%. From dealer inside markets, the inside market midpoint was 32.375. Buy physical requests totaled just over $223.3 million while sell physical requests were around $145.8 - leaving a net open interest of just under $77.5 million to buy. Only Barclays and Citi had limit orders partially filled, all at the final price.