The cost of insuring against default on European corporate debt was little changed, according to BNP Paribas SA.
Contracts on the Markit iTraxx Crossover Index of 50 companies with mostly high-yield credit ratings fell 1.5 basis points to 553.5. The Markit iTraxx Europe Index of 125 companies with investment-grade ratings fell one to 125.5. A decline signals improvement in perceptions of credit quality.
The Markit iTraxx Financial Index linked to senior debt of 25 banks and insurers was unchanged at 200 basis points and the subordinated index was fell one to 340.
A basis point on a credit-default swap protecting 10 million euros ($13.1 million) of debt from default for five years is equivalent to 1,000 euros a year. Swaps pay the buyer face value in exchange for the underlying securities or the cash equivalent should a borrower fail to adhere to its debt agreements.
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