Singapore's DBS Bank, one of the largest lenders in Asia, is planning to offer synthetic collateralized debt obligations in the first quarter. "This is where the market is going," said Sandeep Gill, head of credit derivatives, who will spearhead the effort. Gill said it is waiting for internal approval to launch the structured products, which will happen in the coming months. It established a credit derivatives desk earlier this year (DW, 8/28).
One market official said this would be a positive development as DBS could use its strong regional customer base to bring new clients into the CDO market. He added that it may even be able to capture retail clients who would purchase the products through local funds.
DBS will have an advantage over the international banks in the long haul, according to Gill, adding, "we're one of the largest Asian banks--this is our turf. Everyone else is here today, gone tomorrow." Gill anticipates most of the demand for the products will come from regional clients. He declined comment on the potential size and structure of the deals.
