The authors investigate the cross-sectional variation in the CDS-bond basis, which measures the difference between the CDS and cash-bond implied risk-neutral expected loss, for a large sample of individual firms during the crisis. They test several possible explanations that have been offered for the violation of the arbitrage relation between cash bond and cds contract that would in normal conditions drive the basis to zero. Their findings do not uncover a clear main driver for the anomaly. Rather they point towards several drivers related to funding risk, counterparty risk and collateral quality that force the individual bond basis into negative territory at different phases of the crisis.