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August 2007

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LATEST ARTICLES

  • Commerzbank has hired Julien Mareschal as its new head of ABS trading and David Hoffman as a senior trader on the ABS team. Mareschal ran ABS trading at BNP Paribas, where he was responsible for ABS/MBS and cash CDO trading. Hoffman joins the team as senior trader with a special focus on developing Commerzbank’s ABS derivatives business.
  • UniCredit continues to expand its operations in central and eastern Europe, with the acquisitive Italian banking group turning its gaze towards Ukraine in July. Bank Austria Creditanstalt (BA-CA), which is responsible for UniCredit’s commercial banking activities in central and eastern Europe, has signed an agreement to buy 95% of Ukrsotsbank (USB), Ukraine’s fourth-largest bank by assets. The deal follows June’s $1.5 billion purchase of a controlling stake in Kazakhstan’s ATF Bank and the acquisition of the European Bank for Reconstruction and Development’s 10% stake in Russia’s International Moscow Bank for $229 million.
  • Goldman Sachs has appointed Chris Barter and David Schwimmer as joint CEOs of its Moscow office. Barter was previously co-head of the European financial institutions group in London at the bank. He will relocate to Moscow by the end of the summer. Schwimmer was head of investment banking for Russia and central and eastern Europe. He is already based in Moscow. Goldman received its first Russian securities brokerage licence last year and, according to observers, is hiring aggressively across all products
  • Dresdner Kleinwort has become a victim of its own success in central and eastern Europe, says a source at the bank explaining why the firm has been hit by a series of departures in recent months.
  • Downgrading tranches and revising criteria will not convince the market that the rating agencies are on top of the sub-prime mortgage crisis.
  • Investors will still want access to the best-run funds.
  • Emerging market debt has held up well in the face of a nascent credit crunch in developed markets.
  • Investment house issuance on private electronic markets relieves them of regulatory burdens and speeds up funding. But poor liquidity remains a problem.
  • Environmental, social and governance issues are increasingly prominent with regard to investment management in emerging markets. However, does taking a principled approach to portfolio construction offer the opportunity for greater returns, or leave investors with one hand tied behind their backs?
  • Japan’s equity bounce-back has lost momentum. But there are good grounds for believing that a floor has been reached and that renewed buoyancy is around the corner.
  • "Having been a customer of your bank for more than 10 years, I find it difficult to describe any of you services as excellent. Another good example of SBM’s excellence in customer care I believe is the underground parking at your Vacoas branch. The parking used to be available for customers. However since a few months back customers no longer have access to it, as it seems that it is reserved for the exclusive use of the branch employees!! So much for customer sovereignty"
  • Investment banking has long been a demanding profession. Bankers have been accustomed to always-on cell phones, the ubiquitous BlackBerry and late-night meetings. Spare a thought, however, for one banker caught between a call from the boss and a call of nature.
  • Bank of America has carried out a "functional alignment" of its FX business to drive what it says is greater collaboration across its global rates, currencies and commodities businesses. These are managed overall by Richie Prager. As part of the alignment, Gerhard Seebacher has been named head of trading for all GRCC products. Chris Mandell continues as head of currencies and local markets and has also been named head of sales for GRCC, a newly created position.
  • Dealers are hoping a new-look contract will finally get the European leveraged loan credit default swap market off the ground.
  • Every so often the insurance-linked securities (ILS) sector rears its head and FIG bankers get excited that they will have a rich vein of new assets to bring to the capital markets. Around two years ago the great hope was that value in force (VIF) securitizations from UK insurance companies would take off following a couple of landmark transactions and regulatory encouragement from the Financial Services Authority, but activity there has slowed to a near halt. Once again there are now signs that investment banks and insurance brokers are ramping up their product capabilities amid a pick-up of deal flow in the past year.
  • The 2007 Italian national budget law outlines a new framework for the country’s regional healthcare administrations. The law’s purpose is to force each region with a large deficit in its healthcare funding to formulate and implement a recovery plan. "The national budget for 2007 represents a positive step forward in finalizing a set of rules for Italian healthcare," says Simone Zampa, senior analyst at Moody’s. "It aims to make regions more responsible and more accountable."
  • Jim Siracusa is the new global head of DCM and securitization at Calyon. Siracusa previously worked at Dresdner Kleinwort, where he was co-head of client coverage, which included DCM origination and media, telecoms and technology coverage. In his new role he is responsible for securitization, debt principal finance and client solutions. He also covers traditional DCM, including emerging markets. He reports to Guy Laffineur, global head of fixed income.
  • 283,200,000,000 the volume of share buyback programmes globally so far this year. Share buybacks are up 19% compared with 2006 year-to-date and are at their highest on record, according to Dealogic. Retail has been the most active sector, with $56.7 billion via 14 deals, up from $3.4 billion via 12 deals in 2006 year-to-date. Finance follows with a volume of $45.9 billion via 27 deals and insurance with $25.9 billion via 16 deals.
  • Latin American mutual funds are the best performers in the world year-to-date according to fund tracker Morningstar,which reports rises of 32.26% for the first half of 2007.
  • Euromoney’s latest survey of the leading banks in structured credit shows a clear top tier of five investment banks. They say that providing fresh ideas to clients is what keeps them at the head of the pack.
  • Peru priced a NS4.75 billion ($1.5 billion) 30-year local currency benchmark bond on July 20, as it raised funds to repay Paris Club debt ahead of schedule. Peru sold the sol-denominated bonds, due in 2037, to yield 6.9% in an offer led by Citi. The Peruvian government has approved a sale of up to $2.58 billion-worth of bonds for Paris Club debt, indicating the possibility of further issuance.
  • Country is now a net creditor, paying off external debts and developing local markets.
  • The recent contraction of liquidity has changed the landscape.
  • This month’s plans for a Latin American regional bank hit the rocks as Brazil raised objections to president Hugo Chávez’s plans for the bank.
  • Argentina appointed Miguel Peirano as its new economic minister after Felisa Miceli resigned on July 16
  • Historically, when the US sneezes, Latin America catches a cold, and Mexico comes down with hypothermia. So what on earth is going on in the market for mortgage-backed securities?
  • The number of wealthy individuals in Latin America is growing fast on the back of high commodity prices, buoyant equity markets and foreign interest in acquisitions and IPOs. Private banks are adapting quickly, developing new products to attract investors intent on diversifying from their traditional reliance on fixed income and offshore investment. Jason Mitchell reports.
  • The investor revolt in the leveraged loan market during June and July was long overdue and much needed. But have the excesses of the past few years left the LBO market teetering on the precipice of a far more serious credit squeeze? Louise Bowman reports.
  • Michael Reich, a Harvard MBA student, has come up with a way of tapping into investment talent to run a fund. Reich has set up a website, www.theupdown.com, where keen investors, either students or professionals, can run virtual portfolios, and submit investment research in a competitive environment.
  • There is a lot going on in the swaps industry right now.