Stress test results boost CDSs on financials
In early US trading on Friday, the cost of credit protection on financial institutions fell markedly following yesterday's publication of stress test results by the US government. In contrast to earlier pessimistic predictions - some of which had estimated the capital shortfall would amount to hundreds of billions of US dollars - the results indicated 10 US banks need to raise a total of $74.6 billion.
Citi - which will require a further $5.5 billion in capital - saw its CDSs narrow to 344.1bp from 394.3bp
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