The regulatory decision to block bond insurer Financial Guaranty Insurance Corp. (FGIC) from paying claims has resulted in “a failure to pay credit event,” according to the International Swaps and Derivatives Association (ISDA).

The credit event could trigger payments on credit default swaps covering FGIC. As of Nov. 26, there were 1,276 of such swaps outstanding, which total a net notional $1.02 billion, according to the Depository Trust & Clearing Corp., which records most insurance transactions.

Subscribe Now

Access to a full range of industry content, analysis and expert commentary.

30-Day Free Trial

No credit card required. Access coverage of the securitization marketplace, including breaking news updated throughout the day.