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Credit Risk Gauges in Europe Rise by Most Since Lehman on Greece 

June 29, 2015

Katie Linsell, Sally Bakewell, Bloomberg Business

Measures of risk in Europe's credit markets surged after Greek debt talks broke down, rising the most since Lehman Brothers Holdings Inc. failed in 2008.

A benchmark of credit-default swaps rose by as much as 20 percent to the highest in more than a year, according to data compiled by Bloomberg. Greek bank bonds dropped to their lowest levels on record and contracts insuring the Mediterranean nation’s sovereign debt indicated a 91 percent probability of default.

Greece sent shock waves through credit markets after the government shut its banks and imposed capital controls in an overnight announcement aimed to prevent the collapse of its financial system. Prime Minister Alexis Tsipras’s decision to call a July 5 referendum on austerity measures demanded by the country’s creditors derailed months of negotiations.

Read more: Bloomberg Business

 
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