At 2:00 pm GMT today, the final price for Landsbanki senior debt for the purpose of settling credit derivative transactions was determined to be 1.25%.
The auction was conducted in accordance with the International Swaps and Derivatives Association (ISDA) 2008 Landsbanki CDS Protocol. Creditex and Markit are the official administrators of Credit Event Auctions.
The Credit Event Auction enables 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.
Creditex and Markit will conduct Credit Event Auctions to facilitate the settlement of CDS contracts referencing Glitnir Banki hf on November 5 and KaupÃ¾ing Banki hf on November 6.
The Credit Event Auction process was launched in 2005 by Creditex and Markit in collaboration with ISDA and major credit derivative dealers. Auctions have been held to facilitate settlement of credit derivative trades referencing Washington Mutual Inc., Lehman Brothers Holdings Inc., Federal National Mortgage Association, Federal Home Loan Mortgage Corporation, Tembec Industries Inc., Quebecor World Inc., Movie Gallery, Collins & Aikman, Delta Air Lines, Northwest Airlines, Delphi Corporation, Calpine Corporation, Dana Corporation and Dura.