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Chris Neuharth, portfolio manager at U.S. Bank Corp. Asset Management, says he is considering moving $80 million, or 2% of the firm's portfolio, from Treasuries into corporates. He reasons that corporate bonds should perform well over the next year, after the economy fully recovers. There is no particular trigger for this move besides the assumption that the macroeconomic environment has stabilized and that the risk of a double dip recession is reduced, says Neuharth. However, should the stock market enter a new phase of high volatility and sharp price declines, the firm would postpone the move, he cautions.

Deutsche Bank and Wells Fargo Bank have fattened pricing and added tranches to their $265 million credit for Veritas DGC. The company, a close cousin to the energy sector, could not disguise its bloodline and met with resistance from investors. "The 'B' guys wanted the changes," said a banker familiar with the deal. "The market didn't like the way it was structured." He noted the lead arrangers had to answer concerns about the credit's collateral with a new structure. A Deutsche Bank official declined to comment, while a Wells Fargo official could not be reached by press time. "I don't think the changes were that radical," said Matthew Fitzgerald, cfo of Veritas. He explained that some of the banks wanted a subordinated piece, while some investors wanted a higher yield. "It was to provide additional flexibility for every type of investor," he added.

So we've heard of the curse of the mummy's tomb and even the Sports Illustrated curse but could there be a stadium-naming curse? This week, when Conseco filed for bankruptcy not only did it join the ranks of over-leveraged defaulted companies, but it also became one of the bankrupt companies with a stadium bearing its name. The Conseco Fieldhouse, home of the Indiana Pacers, joins a list that includes the Tennessee Titans' Adelphia Coliseum, the Houston Astros' Enron Field, and the Washington Wizards' MCI Centre.

National City Investment Management is looking to add some 5%, or $250 million, in corporate bond exposure throughout its various portfolios. Cindy Cole, senior portfolio manager of $5 billion in taxable fixed-income, sees corporates benefiting from what she believes will be a slow recovery, driving the 10-year to 5% or higher by the end of 2003. The firm will sell U.S. government securities to raise money for the purchases. Cole says National City will look for a period of weakness in the first quarter, as concerns about war or the overall health of the economy may return, to add further exposure.

Principal Global Advisors is adding to its already overweight allocation in mortgage-and asset-backed securities on the view that the economic recovery will be slow, says portfolio manager Marty Schafer. Schafer, who oversees $7 billion in assets, says purchases for the portfolio's core overweight in MBS pass-throughs and ABS will be made primarily on "short-term sell-offs." His affection for MBS is predicated upon what he says is the sector's low volatility, high-liquidity and excellent carry. Moreover, he adds that "the GSE's are continuing to grow and banks are continuing to add to their retained portfolio's--there isn't a coupon that isn't well-bid or a [dollar] roll that isn't at fail." In respect to ABS, Schafer says he will continue to buy triple-A "major issuer" credit card and auto-receivable paper "on every dip." He declined to name specific issuers, noting, "I'll buy them all, since my only real risk is in short-term price swings."

This chart, provided by Citibank/Salomon Smith Barney Inc., tracks bid-ask prices for par credit facilities that trade in the secondary market. It also tracks facility amounts, ratings, pricing and maturities.

JPMorgan has reorganized its structured credit operation in New York following the shock resignation of Romita Shetty, head of structured credit and alternative investments. Officials familiar with the firm's plans said Maleyne Syracuse, managing director, client management, will take over Shetty's responsibilities in origination and structuring, while Andrew Palmer, managing director, North American credit derivatives, will head the distribution effort. Syracuse and Palmer both report into Andrew Feldstein, managing director and head of credit portfolio management. A rival credit derivatives head said it was surprising that Syracuse would move into origination given her background in sales. Syracuse, Palmer and Feldstein did not return calls by press time.

Romita Shetty, head of structured credit and alternative investments at J.P. Morgan Securities, has decided to leave the group, according to a banker familiar with the situation. Shetty declined to comment. Michael Dorfsman, a spokesman, said Shetty is considering a variety of options within J.P. Morgan and the firm is looking to place her accordingly.

Banc of America Securities has structured what is believed to be the first synthetic securitization of residential mortgages in the U.S. and is eyeballing other forms of consumer risk that could be suitable reference entities. The private deal, dubbed RESI (Real Estate Synthetic Investments), is referenced to a USD12 billion portfolio of Bank of America residential mortgages and was pricing as DW went to press, said an official familiar with the deal.

Five-year credit protection on Cable & Wireless blew out by 500 basis points at the beginning of last week after Moody's Investors Service downgraded the credit to Ba1 from Baa2. Credit-default swaps spreads were trading at 350bps/400bps before the downgrade and opened at 750bps for mid-market protection on Monday, widening out further to 850bps/900bps on Tuesday. Volume increased from the typical handful of trades per week to approximately 20 trades in the inter-dealer market from Friday through Tuesday, said one trader. Generally, volumes were thin last week because of the approaching year end, they added.

Crédit Agricole Indosuez has hired Trent Beacroft, v.p. at hedge fund Parallax Capital Management in Singapore, in a new role as Japanese head of global foreign exchange sales. He now reports to Christoph Bristiel, managing director in London. Bristiel said Indosuez wanted to bulk up its coverage in Asia with a senior hire, declining to elaborate. Beacroft referred calls to Bristiel. Prior to his stint at Parallax, Bristiel was Asian head of global institutional sales at Standard Chartered Bank.