Tuesday, June 26, 2007

BAE Credit-Default Swaps Surge as U.S. Begins Probe Into Saudi Arms Deals

(Bloomberg) -- The perceived risk of lending to BAE
Systems Plc, Europe's biggest weapons maker, surged by a record
after the U.S. Justice Department began a probe into the London-
based company's arms business in Saudi Arabia.

Credit-default swaps based on 10 million euros ($13 million)
of BAE debt jumped 11,000 euros to 28,000 euros, the biggest-ever
one-day increase, according to Deutsche Bank AG. The contracts
are at an eight-month high, indicating a deterioration in credit
quality.


Read more at Bloomberg Bonds News

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