The risk of companies defaulting on their debt continues to increase as concerns remain that lenders, including Countrywide Financial Corp., will not be able to hold on during the worst housing slump in 27 years, Bloomberg reported.

Contracts on the Markit CDX North America Investment Grade Series 9 index, a benchmark gauge of default risk tied to the bonds of 125 companies including Calabasas, Calif.-based Countrywide, rose 3.75 basis points to 100 basis points during early trading this morning in New York, according to Deutsche Bank AG. The index is at its highest level since the CDX indexes started trading four years ago.

Credit-default swaps on Countrywide moved further into troubled levels for a second day with concern that climbing mortgage defaults and the collapse of the subprime mortgage market will force Countrywide into bankruptcy.

Sellers of credit-default swaps demanded 30 percent upfront and 5 percent a year for contracts protecting Countrywide bondholders from default for five years, according to broker Phoenix Partners Group in New York, compared to 28 percent upfront and 5 percent a year at the close of trading yesterday.

There is “no substance” to rumors that Countrywide will file for bankruptcy, company spokesman Rick Simon said yesterday. The speculation caused Countrywide shares to drop 28 percent, the most since October 1987. The company has said it has adequate liquidity to run its business and predicted last October it will be profitable this year.

Countrywide shares fell $2.17 to $5.47 yesterday in New York Stock Exchange composite trading. They declined 79 percent last year.