NEW YORK, Jan 14 (Reuters) - Sellers of protection on Ecuador’s bonds will need to make payments of 68.625 percent of the insurance they sold, based on the results of an auction on Wednesday published by auction administrators Creditex and Markit.
The auction to determine the value of Ecuador’s credit default swaps indicated the contracts were worth 31.375 cents on the dollar, Creditex and Markit said.
Payments on Ecuador’s CDS were triggered when President Rafael Correa refused to meet an interest payment due on Dec. 15 on the country’s 2012 global bond. Correa also declared default on all Ecuador’s $3.8 billion global bond debt, citing a government ruling that the bonds were contracted illegally.
Net volumes of $490 million are outstanding in CDS backed by Ecuador’s debt, according to data by the Depository Trust & Clearing Corp. (Reporting by Karen Brettell; Editing by Tom Hals)
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