Asia's currencies may be worth less than they were, but in two Asian city states a new currency is on the rise - the electronic variety. As Steven Irvine reports, central bankers want to encourage e-cash but they are nervous about its implications.

The most important event in modern financial history is upon us. In the afternoon of December 31 the official euro conversion rate will be announced. At that moment, 11 national currencies will effectively cease to exist and core Europe will have a single currency.

Western lawyers and financiers have laboured hard and long to achieve Middle Eastern financings which comply with Islamic law. A recent legal innovation may hold the key.

Why should a UK bank become a tax collector for the Germans? That is the not-so-hidden agenda that international bondholders see behind a proposed EU directive on taxation of savings.

Could it be that Chase is not as solid as we had all been led to believe? The US bank has been eyeing acquisitions recently, leading everyone to assume that it is in rude financial health. But events at last month's five-kilometre run, the Chase Corporate Challenge at Battersea Park in London, suggested otherwise.

Our annual survey of asset managers outside the US, in conjunction with InterSec Research Corporation, shows the continuing dominance of Japanese and Swiss institutions. But industry consolidation is propelling firms such as Credit Suisse and Zurich up the rankings. Report by Jim Sirius.

Times may be tough in emerging markets but strong banks are doing more than just surviving. Experienced in dealing with volatility, many banks are both withstanding the shocks and positioning themselves for the next upturn. By Brian Caplen.

Last National Bank of Boot Hill, London, EC2

Issuer: Orange

Controversial rules designed to monitor and control borrowing by private and public-sector companies are being finalized by Egypt's ministry of economy. Senior government officials say the measures will prevent the economy from becoming vulnerable to an Asia-style collapse. If they aren't blocked by another government department, the new regulations, the Sphinx Protocol, should be published in coming weeks. The ministry of economy's plan would create a database of all current and potential bond issuers. Advance details of issues would be required, including the volume, maturity, coupon, currency and market of issuance. The reporting system will also be used to control the quality and quantity of borrowings.

Something strange is happening in the Taiwanese banking sector. Despite the ministry of finance having stated its aim of allowing banks a universal remit, it is now planning to issue industrial banking licences. As Rachel Wu, banking analyst at Warburg Dillon Read in Taipei points out: "Industrial banks create another niche within the financial sector." Acting as an industrial bank in Taiwan entitles the licence holder to arrange a variety of funding instruments for corporates including commercial paper and to undertake venture capital projects. To date, only state-run Chiao Tung Bank has such a license.

According to Moody's Investors Service, there were 82 downgrades of US corporate credit ratings in the second quarter of 1998, the most for any three-month span since 1991 when the US economy was deep in recession. For the first time in nine quarters, the number of downgrades outstripped the number of upgrades (79 ratings were upgraded from April to June 1998).

Euromoney's cover story in April "Sinking the unsinkable" raised the issue of apparent unwillingness among European governments, official bodies and even private-sector financial institutions to address the possibility of a break-up of European monetary union in the first years following the introduction of the euro in 1999. Consultants at Mitchell Madison, a firm set up in 1992 by five ex-McKinsey professionals and now employing more than 600 people worldwide, have been investigating the same question. In July, the firm released the findings of a survey of UK-based financial institutions including asset managers responsible for £1.1 trillion ($1.8 trillion), or 40% of the UK's assets under management.

What's the chance now of an Emu break-up? Euro-agnostics say the most likely event is the exit of a single country because euroland is too tough for it, or too weak. But just as likely, if not more so, is a fudge and fix by member governments desperate to keep the show on the road - ways would be found of pumping money into a country threatening default.

The world's biggest company, General Electric, has passed another milestone. On July 15 its market capitalization exceeded that of the entire Hong Kong stockmarket by $10 billion. At the close of business it was worth $306 billion. GE is covered by 42 analysts, Hong Kong by 498 analysts. So does that make Hong Kong overbroked or GE overvalued? SI

For some, life after a career in finance means the priesthood or opending a restaurant. But Anthony Hotson left Warburg Dillon Read last month to study old stones.

"Show me the money." The catchphrase that lit up Jerry Maguire, the Oscar-winning film about a sports' agent played by Tom Cruise, could soon have added resonance in financial markets.

It's not often investors buy stock for reasons of charity, but Jardine Fleming achieved this feat on June 16 when celebrating its inaugural day as a member of the Singapore stock exchange. It decided to give half of its commissions to charity.

Too many people believe that the Asian crisis is over. It has only just started. Investors are encouraged by the reforms that Asian governments have said they will implement. The World Bank, IMF and US government - if those last two can still be considered separately - have added to the euphoria by praising the governments for the swiftness in capitulating to their demands. And the markets have responded. Capital gains on some Asian benchmarks were 18% in the first quarter.

Currency unions have come and gone but this is by far the biggest and boldest experiment of them all. The euro will wrench market share from the dollar as an international and reserve currency. It will trigger a gigantic rebalancing of investmetn portfolios. It will stimulate growth in equity markets and labour mobility. Yet it also threatens to tyrannize the economic management of individual states and pitch Europe towards the imperative of a single economic policy. In the following series of articles, writers and economists describe euroland, what forces will drive it, and what impact it will have on banking, finance and international markets.

So far, Australia has emerged from the Asia crisis remarkably unscathed. In fact, it seems like just the right sort of stable market for European investors seeking diversification. Australian borrowers are responding by getting on the euro issuance bandwagon. Albert Smith reports.

Looking for a convergence play in Europe? There's still one bet left: Greece, potentially the last of the euro-bubbles. Investors keen to gamble on Greece's entry to Emu may find their chance in the country's privatization programme.

Propelled by a new breed of dynamic managers, Italy's banks are homing in on shareholder value. Consolidation is the battle cry, with three large mergers already announced. But choosing partners may prove the easy part. The real problems will start when the banks try to integrate. By James Rutter.

One of Germany's great tacticians and diplomatic fixers, Horst Köhler is poised to step up from German domestic sagas to an international arena as the next president of the European Bank for Reconstruction and Development.

Size is a well-known impediment to fund-management sprightliness and profitability. As traditional institutional investors leap belatedly on the bandwagon, that's become as true of hedge funds as of staider operations. The likely outcome: significantly declining returns. By Mike Steinberger.

The news of an alliance between the sleepy London Stock Exchange and the Deutsche Börse, its biggest European rival, surprised the market. Eventually the partners hope to bring in other bourses. That pleased the Dutch but the French felt slighted - they'd been courting the Germans too. The devil will be in the detail: the Germans let slip that they thought their settlement system would win out, much to the chagrin of London's CrestCo and the LSE's derivatives counterpart Liffe. So will it be London-on-the-Main or Frankfurt an der Themse? Antony Currie reports.

A smell of disinfected newness lingers in the London office of Bank Austria Creditanstalt Futures. Launched on June 1, it's the first venture in the western hemisphere to use the recently merged bank's name and corporate red is much in evidence; from the trendily designed logos emblazoning the walls to the leather sofa in reception.

A troubled government that swaps domestic debt for foreign currency-denominated debt would seem to be inviting catastrophe - isn't that what dumped Asia in the mire? But Russia has done exactly that. Alex Jurshevski argues that this and other measures are just what Russia needs.

The love affair between increasingly yield-hungry European investors and corporate borrowers is becoming ever more passionate. Their sweet nothings include high yield bonds, convertibles, exchangeables and dealer remarketable securities. Rebecca Bream checks out some of the hottest dates in the market.

Born out of a bloody cull, shaped by a succession of departures, HSBC Asset Management has led a tortured existence. While competitors have grown through acquisitions HSBC has been reinventing its business. The result? It's lagging behind the market leaders in both size and performance. Is now the time to buy? Andrew Capon and Julian Marshall report.