H&R Block, the tax and consulting firm, is seeing its CDS spike as a result of a threat to a key part of its business.
HSBC, the British bank, says it will no longer provide tax refund anticipation loans to H&R Block. H&R Block is suing HSBC, claiming they are breaching their contract.
The concern is that H&R Block will no longer be able to provide these loans, which are a key part of their business. CDS has widened dramatically on the concern.
Further, the company’s stock has fallen 52.56% this year, so this isn’t the only problem facing the company. It is also exposed to the mortgage market, through its former ownership of Option One Mortgage Corporation.