Gross pans Greek 'credit event' CDS ruling

PIMCO's Bill Gross has criticised the decision that Greece's debt restructuring should not spark a payout on credit default swaps.

The International Swaps and Derivatives Association ruled on Wednesday there had been no ‘credit event' with regard to the bonds, meaning the swaps will not pay out. Greek creditors will see an initial €186bn of bonds swapped for longer-maturity debt next week and ‘voluntary' haircuts will be enforced via retroactive collective action clauses (CACs). Speaking to CNBC, Gross said the decision would have "upset" him were he a buyer of protection on Greek debt. "If insurance for CDS and protection against default for countries is invalidated that would be much like taking an insurance...