Below we highlight the prices for insuring against default for the major global banks and brokers.
The credit default swap (5-Yr CDS) is quoted in basis points and is the yearly cost of insuring against default for 5 years. So a CDS trading at 100 would cost $100 per year to insure $10,000 worth of bonds for 5 years.
As shown below, default risk at Lehman (LEH) and Merrill Lynch (MER) are currently the highest. Both are currently more than 250 basis points. Citigroup (C) ranks third, followed by BSC, WB, MS, GS, UBS and JPM.
At the bottom of the list (the safest) are BNP Paribas (OTCQX:BNPQY), Deutsche Bank (DB) and Wells Fargo (WFC). While insuring against default is still very high for most of these companies, prices were much higher just a couple of weeks ago.