European banking monitor: greek credit risk tightens

Editor’s Note: This can be a complimentary research note from Hedgeye Analyst Matt Hedrick initially presented to subscribers on April 14, 2014 at 11:20 a.m.

Here are key European banking risk monitors, that are incorporated included in Hedgeye Financials team’s Monday Morning Risk Monitor. If you want to get the work from the Financials team or request an effort please email And, for additional info on our services, click the link.

European Banking Monitor: Greek Credit Risk Tightens  $NBG - greece

European Financial CDS Swaps across Europe’s banking system were little altered (median change = bps), however the Greek banks still tighten particularly, shedding typically 40 bps previously week and 185 bps previously month. This news that GS & MS is going to be leading another offering for National Bank of A holiday in greece does not hurt either.

Sovereign CDS – Sovereign swaps mostly widened over a week ago. Irish sovereign swaps tightened by -2.7% (-2 bps to 71 ) and Spanish sovereign swaps widened by 7.1% (6 bps to 93).

Euribor-OIS Spread – The Euribor-OIS spread was unchanged week-over-week at 13 bps. The Euribor-OIS spread (the main difference between your euro interbank lending rate and overnight indexed swaps) measures bank counterparty risk within the Eurozone. The OIS is similar towards the effective Given Funds rate within the U . s . States. Banks lending in the OIS don’t swap principal, so counterparty risk within the OIS is minimal. By comparison, the Euribor rates are the speed offered for unsecured interbank lending. Thus, multiplication backward and forward isolates counterparty risk.

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