"Worst trade of all time" pits Santander against Portuguese client
Dealers settled a crop of disputed derivatives trades with Portuguese state-owned entities last year, with one exception – Santander is set for a court battle with the country’s state-backed rail operator, over a trade that critics describe as “nonsensical”. Tom Osborn reports
"This is a contender for the worst trade of all time,” says one London-based corporate hedging adviser. It sounds harsh until you look at the numbers.
The counterparty stuck on the wrong end of the trade is Portuguese state-backed rail operator Metro do Porto (MdP), which entered into the €89 million amortising fixed-for-floating interest rate swap in 2007. Halfway through the contract’s life, the
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