Bloomberg News

RBS Penalized $1.9 Million After Dynegy Credit Swaps Auction

November 30, 2011

Nov. 29 (Bloomberg) -- Royal Bank of Scotland Group Plc, the U.K.’s biggest government-controlled bank, was assessed a $1.9 million penalty after submitting a below-market price in an auction among 13 credit-default swap dealers today to set a value for the debt of Dynegy Inc.

The so-called adjustment amount was set after RBS offered 31.5 cents on the dollar for debt of bankrupt Dynegy Holdings LLC, below the initial market midpoint of 69.5 cents, auction administrators Creditex and Markit Group Ltd. said today on the website CreditFixings.com. Citigroup Inc. made the highest offer at 72 cents. There was a net open interest to buy $61.2 million of the bonds.

To contact the reporter on this story: Shannon D. Harrington in New York at sharrington6@bloomberg.net

To contact the editor responsible for this story: Pierre Paulden at ppaulden@bloomberg.net


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