LONDON, Nov 6 (Reuters) - Sellers of protection on Icelandic bank Kaupthing KAUP.IC will have to pay out 93.375 percent of the senior debt they agreed to cover after an auction on Thursday set the value of the credit default swaps.
The final value of the contracts will be 6.625 percent, according to results published by auction administrators Creditex and Markit.
The outcome is higher than indicated by Kaupthing's underlying bond prices, which were bid at 2 cents on the euro and offered at 3 cents on Wednesday, a trader said.
The Depository Trust & Clearing Corp. has calculated gross notional value of outstanding Kaupthing CDS contracts at $34.3 billion and the net value at $3.8 billion after taking into account offsetting positions.
Reporting by Natalie Harrison and Jane Baird