October 4, 2017 / 1:17 PM / a year ago

Spanish bank, Italy CDS rise on political tensions

LONDON, Oct 4 (Reuters) - The cost of insuring exposure to Spanish bank debt and Spanish, Italian and Portuguese sovereign debt rose on Wednesday as the impact of the crisis in Catalonia spread to the wider euro zone region.

Five-year credit default swaps (CDS) for the Catalonia-based CaixaBank rose 2 basis points (bps) from Tuesday’s close to 76 bps, the highest since mid-July, whilst Banco Sabadell CDS were at a one-month high of 75 bps, according to IHS Markit data.

The ripples from Spain’s political crisis spread to other southern European states too, driving Italy’s 5-year CDS 4 bps higher to 145 bps, the highest since end-August. It ended last week at 138 bps.

Portuguese 5-year CDS rose 2 bps to 146 bps, the highest since mid-September and Spain’s CDS rose 2 bps to 73 bps, a five-month high.

Reporting by Claire Milhench; editing by Sujata Rao

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