Derivs - People and Markets

On the anniversary of Lehman Brothers’ bankruptcy filing, it seems fitting to consider the magnitude of losses—both on derivatives referencing Lehman and on trades where Lehman served as counterparty—that might have been sustained had another dealer failed soon after.

The International Swaps and Derivatives Association is working on a standardized contract for longevity swaps, a sign the nascent market is taking off.

Nasir Afaf, head of fx options trading at Calyon in London, left the bank last week.

London-based Cater Allen Private Bank, a subsidiary of Grupo Santander, is to launch its third FTSE-linked, two-term capital guaranteed structure next week. The Capital Guaranteed Defined Return Plan 3 gives investors a choice of either a 3.75- or 5.5-year maturity, with a higher fixed return on the longer-dated option.

BNP Paribas this week began marketing a so-called Erasable Knock-Out equity linked note. The note is linked to a pair of stocks and generates a return as each stock individually hits a predetermined knock-out barrier and is removed from the basket.

Royal Bank of Scotland has hired three of Barclays Capital’s corporate sales staffers to kick start a sales team in Korea.

Bank Indonesia’s intentions to restrict what offshore providers can sell into the country are expected to feature two points that have bankers worried. The first is that BI will only permit sales of credit-linked notes and collateralized debt obligations on the strict proviso the offshore issuer has at least one onshore branch.

New York-based GlobeOp Financial Services will launch an add-on to its over-the-counter derivatives trade processing system next week, allowing fund managers to access current and historical valuation and trade reconciliation data more efficiently than before.

Nomura has reportedly hired Trevor Rosmarin from Merrill Lynch as its head of hedge fund fx derivatives sales.

Goldman Sachs and Bank of America each issued structured notes this week designed for investors bearish on the U.S. dollar’s prospects over the next two years. Each note is linked to the performance of a basket of currencies against the dollar and offers some principal protection.

Mike Taylor, a former director in single stock equity derivatives trading at Citadel in London, has joined UBS.

A number of wrinkles in Thomson’s debt, including a potential indemnity related to its revolver, lie behind the delay in determining the list of debt obligations deliverable into the credit default swaps settlement auction.