Dubai debt insurance costs rise
Emirate now ranks as one of the riskiest markets in the world for sovereign debt.
February 13, 2010 8:02 by kippreport
Dubai is now considered one of the riskiest sovereigns in the world in terms of insuring debt, ranking behind only Argentina, Venezuela, Ukraine and Pakistan.
According to CMA DataVision, Dubai’s five-year credit-default-swap spread – a measure of credit risk – rose in late trading on Friday, according to the Wall Street Journal.
It now costs $636,000 a year to insure a notional $10 million of Dubai’s sovereign debt against default for five years. This reflects “a combination of…a massive debt buildup, overreliance on short-term debt of variable quality and help by a wealthy neighbor,” the newspaper quoted credit strategists at BNP Paribas SA as saying in a note to clients.
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1 Comment
Not surprising at all.