Derivs - People and Markets

UBS is selling a structured note that allows investors to take a view on credit and inflation in return for higher yields.

Structured products are set to arrive in Brazil, with recently passed legislation allowing foreign and local firms to structure and distribute to local investors. Regulators are hashing out the details on which type of products will be permitted and firms have started beefing up their operations.

Newedge is looking at the roles it might play once rules that follow the Dodd-Frank Act go into effect.

Citigroup has again expanded its Asian equity-syndicate desk in Hong with the hiring of Harish Raman as v.p.

Sentosa Capital, the firm established by former fixed-income and capital-markets bankers at Standard Chartered, have launched a hedge fund that will trade Asian debt and use credit default swaps.

Daiwa Capital Markets has appointed Oliver Nighjoy as head of equity-linked origination for Asia-Pacific ex Japan as part of its expansion of its equity-capital markets business in the region.

Mutual fund firms are concerned about the possibility of being held responsible for reporting derivatives transactions with non-U.S. counterparties, according to Leigh Fraser, partner with Ropes & Gray.

Corporates in China are starting to buy vanilla over-the-counter derivatives to hedge commodities and foreign exchange risk.

New regulations and developments including a central counterparty will make the over-the-counter derivatives and repo markets in Singapore more robust, Ng Nam Sin, assistant managing director at the Monetary Authority of Singapore said in a speech yesterday.

The China National Association of Financial Market Institutional Investors will develop a pricing benchmark and standardized documentation for onshore credit derivatives.

Scott O’Malia, a member of the U.S. Commodity Futures Trading Commission, warned that derivatives regulations being developed will fail if they are so rigid that they “create a market structure that fractures liquidity and creates an incentive to utilize dark pools, simply because our rules do not provide the flexibility necessary to facilitate on- exchange transactions.”

The American Benefits Council and the Committee on Investment of Employee Benefit Assets have expressed concern that a private derivatives regulatory group headed by the Federal Reserve may weaken regulations under the Dodd-Frank Act.