Foreign exchange
AngloGold cuts hedging by 12%
South Africa’s largest gold producer, AngloGold, reduced its hedge book by 12% in the first quarter, as it moved to gain exposure to a rising spot price.
WorldCom spreads blow out
The cost of protection on WorldCom’s five-year debt blew out today, following the resignation of chief executive Bernard Ebbers.
Basel regulators hope for SME solution by mid-June
Global banking regulators are optimistic they can resolve by mid-June the vexed question of the treatment of lending to small to medium-sized enterprises (SMEs) under the proposed Basel II bank capital adequacy Accord.
German securitisation volumes quadruple in Q1
The German securitisation market quadrupled in the first quarter of 2002 to end at $8.42 billion, compared with $2.16 billion in Q1 2001. This makes Germany the largest securitisation market by volume in Europe, with the UK second with $8.3 billion and…
Volcker challenges the benefits of financial engineering
Paul Volcker, US Federal Reserve chairman between 1979 and 1987 and present chair of the Independent Oversight Board for embattled Enron auditor Arthur Andersen, has said he is "ambivalent" about the value of financial engineering to the US economy.
LSE predicts UK equity derivatives surge
Clara Furse, chief executive of the London Stock Exchange (LSE), today warned that stamp duty on UK share trading could increasingly damage London’s competitive advantage in international financial markets and thereby reduce the likelihood of the UK…
Credit Markets Update: Telecoms reeling on bad news
The battering of US telecoms credit default spreads continued this week, following a grim financial forecast by WorldCom last Friday that sparked a flurry of downgrades on the company’s debt. Five-year protection spreads on WorldCom widened to 1,700…
Hedge fund backed by Lehman launched today
Edgeworth Capital, a London-based hedge fund backed by investment bank Lehman Brothers, was launched today. The firm's first two funds, a global fund following a macro strategy and a pan-European long/short equity fund, will be launched in September.
Gold hedging falls 4.5% in 2001, says study
Gold hedging fell 4.5% last year, as producers saw little premium from selling gold forward due in part to the low interest rate environment.
Risk 2002 Europe: Derman highlights new behavioural finance direction
A fresh perspective on the risk-reward payoff that drives financial markets can be gained by abandoning the traditional concept of time in financial models, according to Emanuel Derman, a New York-based managing director in Goldman Sachs’ firm-wide risk…
Borsa Italiana launches new derivatives trading platform
Borsa Italiana, the Italian equity and derivatives exchange based in Milan, has launched its new electronic trading platform for derivatives, called OM Click. The platform, which uses technology from Sweden’s software and financial services provider OM…
Greenspan highlights mortgage agency concerns
Federal Reserve chairman Alan Greenspan yesterday warned that government backing for US mortgage agencies, Fannie Mae and Freddie Mac, may prompt those that trade their mortgage securities to take excess risks. His comments are likely to further heat up…
TFS-Icap signs up DerivaTech
TFS-Icap, the hybrid voice and electronic broker for currency options, today said it has started to use the DerivaTech platform as its foreign exchange tool for voice-brokered transactions.
Major Spanish client for patsystems
Banesto Bolsa, the Spanish brokerage arm of the Banesto banking group, has signed up to J-Trader Gold, a derivatives trading service supplied by patsystems, the London-based software vendor.
JP Morgan Chase and Deutsche join Currenex as member banks
JP Morgan Chase and Deutsche Bank have joined Currenex, the electronic foreign exchange trading portal. Currenex said the additions will enhance liquidity on the FX trading platform, and the news follows from the collapse of rival Atriax earlier this…
Risk 2002 Europe: Risk management remains an ‘art’, says Breeden
Douglas Breeden, dean of the Fuqua School of Business at Duke University, said risk management remains an ‘art’ despite significant theoretical advances in the subject, using the example of disparate pricing in US mortgage securities to illustrate his…
Atriax fall stirs corporates into action
Online FX trading could be set to soar, according to industry officials, after the collapse of multi-bank platform Atriax removed some obstacles to client take-up. And its rival FXall looks set to benefit most from the surge in uptake, according to a…
AIB appoints 'special' risk management adviser
Allied Irish Banks has appointed a 'special adviser' on risk management in the wake of fraud investigations into its US subsidiary Allfirst, which lost almost $700 million in currency trading.
Isda AGM: FpML2.0 ready for widespread deployment
The latest version of Financial products Market Language (FpML) – the e-commerce standard supporting OTC trading for financial derivatives – which could potentially save the industry $1 billion per year in processing costs, has received ‘trial…
Rates Markets Update: Swaps ride out terrorist scare
Interest rate swap spreads continued in a narrow range this week, despite a slight widening caused by the fear that the crash of a small plane into a Milan office building on Thursday was the work of terrorists. Initial fears led to 10-year US dollar…
Isda AGM: Sweden could pull back from swaps market
More bank credit rating downgrades could prompt Sweden’s Debt Office to pull out of the swaps market. That was the warning delivered today to the International Swaps and Derivatives Association meeting by Erik Thedéen, head of the debt management…
Isda AGM: No room for doom and gloom
At the International Swaps and Derivatives Association's AGM today, outgoing Deutsche Bank chairman Rolf Breuer predicted more strong growth for the derivatives industry, despite problems faced by other financial markets.
Credit Markets Update: Spreads narrow as outlook turns positive
US Federal Reserve Chairman Alan Greenspan’s testimony before Congress today indicated that the Fed does not plan to raise interest rates any time soon and this, along with signs that the US economy is strengthening, caused spreads in the credit…
Isda AGM: OTC derivatives growth soars in H2 – Isda survey
The value of notional outstandings of over-the-counter derivatives contracts grew significantly in the second half of last year, according to a survey released today by the International Swaps and Derivatives Association. Credit derivatives saw the most…