Editor's letter

As we navigate past the first important period of the year, the question is how to keep up or merely stand still. The volume of structured products business transacted in February has always been a good indicator of the year ahead, and results so far indicate that, despite being worse than 2008, this year might not be as bad as many had feared. The same month also saw financial results from structured products supremos BNP Paribas and Societe Generale which seem to signal that the final quarter of 2008 could prove to have been the nadir of the crisis.

Keeping up with new structures is not too difficult at the moment as the retreat from all things exotic continues. Working through what issuers, distributors and regulators are doing about this is, however. The UK is an interesting example, not least because its market for structured products is humming along quite happily. But change is afoot. Distributors such as Meteor have started incorporating the names of issuers in their documentation, a measure that has met with the full approval and support of the Financial Services Authority, which puts the practice at the top of its latest recommendations on structured products.

This may not seem like much in the way of progress, but it is, chiefly because other players in the market are either copying the approach or at least keeping a close eye on it. Issuer credit quality remains the theme of the day - whether through credit ratings or individual and sovereign credit default swap levels - and is the commonest question for everyone in the business.

While you contemplate that, keep an eye out elsewhere in Europe for the make-or-break structured product deal that has been designed to kick-start the market in Europe. Apparently it includes Exportfinans, the Norwegian export credit agency, as issuer in a EUR1-2 billion deal arranged by Deutsche Bank, Morgan Stanley and Wachovia, among others.

- Richard Jory; [e-mail]; [phone].