CDS Settlement for the Nationalized Icelandic Banks

I'm a bit late on this, about a week ago, auctions were held to determine the payout amounts for credit default swaps (CDS) for the banks that Icelandic regulators seized in October. The CDS holders will receive the difference between par value and the auction result.

Bank	Senior Debt	Subordinated Debt
	Value	Value
Landsbanki	1.250%	0.125%
Glitnir Bank	3.000%	0.125%
Kaupthing Bank	6.625%	2.375%

Yep, that's right. Landsbanki's subordinated debt is only worth 0.125 cents on the dollar. The banks succumbed to levered speculative positions and sprawling European operations. The result was a decimated currency and a crisis that still might wipeout an entire country. The banks are embroiled in lawsuits and asset seizures (U.K. in particular) that afford us a glimpse at the depth of the mismanagement on the global landscape.

http://www.creditfixings.com/information/affiliations/fixings/auctions/current.html

More on Iceland:

http://edition.cnn.com/2008/BUSINESS/10/28/iceland.interest.rate.ap/index.html#cnnSTCText