Narrowing credit spreads continue to hamper bank results


Tightening credit default swap (CDS) spreads on Morgan Stanley's debt have chipped away at the bank's third-quarter results, but it is not the only bank to have suffered.

Morgan Stanley announced a $757 million profit for the third quarter on October 21, compared with a loss of $159 million in the second quarter. However, it said, it had taken a $0.9 billion loss as CDS spreads referencing the bank's own debt narrowed further. Five-year senior CDS spreads on the firm moved from 191 basis points

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