Credit default swaps on Russian companies face uncertain future

With CDS auctions on sanctioned companies unlikely, traders may have to rely on dealer estimates

Gazprom selloff
Flickr/Diverse Stock Photos

Sanctions prohibiting the trading of Russian corporate debt threaten to undermine credit default swaps written on the companies concerned, and may force traders to rely on dealer estimates to settle contracts.

If a sanctioned Russian company defaults, the auction process used to value its corresponding CDS will not be able to function as designed, since such a process involves the physical trading of bonds.

“The linchpin for the auction is the ability to physically deliver securities,” says

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact [email protected] or view our subscription options here: http://subscriptions.risk.net/subscribe

You are currently unable to copy this content. Please contact [email protected] to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to Risk.net? View our subscription options

If you already have an account, please sign in here.

You need to sign in to use this feature. If you don’t have a Risk.net account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here: