Credit derivatives houses including JPMorgan and BNP Paribas expect to launch local Asian currency-denominated credit derivatives next year. "For Korea, Hong Kong and Singapore, the demand is there--it's really a matter of market makers being convinced there's enough depth in these markets," said Chris Nicholas, managing director and head of Asian credit markets at JPMorgan in Hong Kong. "I'd be very surprised if this didn't happen in certain jurisdictions," said Brian Lazell, Asia-Pacific head of credit markets at BNP in Hong Kong.
Lazell said the signs of a real market will likely sprout in the second or third quarter as regulators become more open to the instruments. "This is occurring already--there's just the process to go through--and we've seen evidence of that," added Lazell. For Korea, such firms as Citibank are already hoping to offer won-denominated credit products in the coming months (DW, 11/17).
