Structured products
First Italian hedge fund to open in July
Kairos Partners will become the first hedge fund in Italy when it starts trading in July, after receiving approval from Banca d'Italia, the central Italian regulator, yesterday.
Partners aims to offer €500m exchangeable hedge fund bond
Partners Group, a $4 billion alternative asset manager headquartered in Switzerland, plans to launch a €500 million innovative exchangeable bond linked to a pool of hedge funds within the next few weeks.
Credit Markets Update: Telco spreads balloon following WorldCom fraud
The admission by US telco WorldCom of a multi-billion dollar accounting fraud late yesterday sent credit protection spreads ballooning as much as 100 basis points today in both the US and Europe. But markets settled down as the day progressed, traders…
Tools for the trade
Credit Risk
Hedge funds set to steal share from mutual funds in Asia, says Barclays’ Yang
Hedge funds – a once-shunned asset class in Asia – are likely to take market share away from traditional mutual funds, according to Angus Yang, director in the equity finance group at Barclays Capital in Tokyo.
Banks bid for Roman risk management
Comune di Roma – the City of Rome – is close to awarding a mandate for the risk management of its €6 billion of outstanding debt, said bankers involved in a beauty parade city authorities have been holding over recent weeks.
Investor demand for Asian hybrid products growing
Growing numbers of Asian investors are turning to structured credit products in order to benefit from enhanced yield in an environment of low interest rates and tightening credit spreads, says Patrick Kwan, director of debt capital markets and investment…
Merrill Lynch continues with forex hires
Merrill Lynch has continued its forex hiring spree with the hire of Rabobank’s former global forex head, Michele di Stefano.
France Telecom debt protection cost soars following downgrade
The cost of five-year credit protection on France Telecom debt widened by 100 basis points (bp) today as rating agency Moody’s cut its credit rating to one notch above 'junk'. Five-year credit default swaps were priced at 600/650bp in heavy trading.
Totem widens equity derivative valuation service
Totem Market Valuations, the London-based over-the-counter (OTC) derivatives valuation specialist, is to expand its service to include floored cliquet options this month.
FSA sets August date for sale of securitised derivatives to retail sector
The UK’s Financial Services Authority (FSA) today published details of the regulatory regime for securitised derivatives that will enable the products to be available in the UK to retail investors. The proposed listing and conduct of business rules for…
Credit markets update: financial sector spreads widen in heavy trading
Credit default swap spreads for the financial sector in Europe generally widened this week in relatively heavy trading, as equity market falls and concerns over the financial sector’s overall credit strength caused nervousness among investors.
SG to enter structured bond business in South Korea
SG, the investment banking arm of France's Société Générale, plans to start offering structured bonds in South Korea by the second half of this year to cater for the growing demand for yield enhancing structures in the country, according to an official…
Japan credit market update: technology sector spreads hit by Nasdaq slump
Credit default swap spreads on Japanese technology names were wider this week, in part due to the decline in the technology-heavy Nasdaq equity market in the US but also due to a technical correction caused by range-bound trading, dealers said.
Barep and JP Morgan close $215 million emerging market CDO
Paris-based alternative investment fund Barep Asset Management, a wholly-owned unit of French banking group Société Générale and JP Morgan Securities, has closed a $216.6 million collateralised debt obligation (CDO) backed by a revolving pool of US…
Increased regulation for OTC commodities is unnecessary, claims Isda
Increased regulation for the over-the-counter (OTC) commodity derivatives market designed to protect investors is unnecessary, according to the International Swaps and Derivatives Association (Isda). The European Commission is proposing regulation of…
S&P set to change BT debt outlook to stable from negative, says BT employee
Rating agency Standard & Poor’s is set to raise British Telecom’s (BT's) A- rating from ‘negative outlook’ to ‘stable outlook’, said a senior BT employee late yesterday.
DrKW hires Kobashi in Tokyo to offer risk management services to pensions funds
Germany’s Dresdner Kleinwort Wasserstein (DrKW) has hired Yoshikazu Kobashi from Morgan Stanley Japan to oversee the bank’s corporates and pensions marketing in Japan. Kobashi’s team will offer risk management solutions to corporates and pensions,…
KDB sets up credit derivatives desk in Seoul
The Korea Development Bank (KDB) has established a credit derivatives desk following an internal reorganisation of the bank's derivatives operations and in response to the growing credit derivatives market in the country, said Hae-Geun Chung, head of the…
Swiss Re closes first round of catastrophe risk securitisation
Swiss Re Capital Markets has closed the first round of an innovative $2 billion natural catastrophe risk securitisation programme. The multi-peril, multi-year programme is known as Pioneer 2002, according to a catastrophe risk investor, who wished to…
Aquila cuts energy staff, seeks partner
US energy company Aquila, which announced plans to wind down its energy derivatives trading book yesterday, took a large step towards doing so today by letting go 44% of its Merchant Services energy risk management workforce worldwide, including 71 of…
Goldman study: S&P 500 volatility rockets in Q2
Single-stock and index volatility has shot up since the end of the first quarter of 2002, according to research by investment bank Goldman Sachs.
Credit Markets Update: European spreads drift wider due to negative sentiment
Credit default swap spreads in Europe drifted gradually wider during the week, reacting to weakness in the equity markets and general economic pessimism. Five-year debt protection spreads were 30 to 40 basis points wider on European telecoms, 3-8bp wider…
Japan Credit Market Update: Investors run for Sumitomo cover ahead of jumbo debt offer
The banking and electronic sectors were the most traded in Japan’s credit default swap market this week, driven by a new jumbo subordinated debt offer from Sumitomo Mitsui Banking Corporation and continued interest in the electronics sector.