FRANKFURT: The European Central Bank’s top supervisor said on Tuesday he was concerned by a selloff in Deutsche Bank shares late last week it showed investors were on edge and could be spooked by moves in the small market for credit default swaps (CDS).
“What concerned me really was the amount of nervousness, disquiet that I perceived in the market and among investors,” Andrea Enria told a conference in Frankfurt.
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“There are markets like the single-name CDS market which are very opaque, very shallow and very illiquid and with a few million (euros) the fear spreads to the trillion-euro-assets banks and contaminates stock prices and also deposit outflows,” he added, calling for these instruments to be centrally cleared.
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