Australia's Macquarie Bank is planning to offer clients synthetic collateralized debt obligations linked to the domestic asset-backed and mortgage-backed markets this year. "We're not quite there yet, but these are promising developments," said Gary Vassallo, head of derivatives in Sydney.
It is looking at increasing the number of products it offers because more funds are getting approval to trade credit products. "We're approaching a critical mass," he added. While Vassallo expects Macquarie's first ABS and MBS CDOs to hit the market in the coming months. "Due to the large amount of underlying these make sense--it's just about finding the right structures," he added, declining to comment further on the products.
