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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.

TIAA-CREF will rotate 5-12% of its intermediate bond portfolio, or $270-648 million, from Treasury Inflation Protected Securities into mortgage-backed securities, corporates and nominal Treasuries, according to Lisa Black, managing director and portfolio manager. Black declined to be more specific on the firm's potential purchases, saying that future allocation has not yet been defined, but spread products such as corporates and MBS will be given priority for yield purpose.

Solus Investment Funds, which manages £3 billion in fixed-income assets, is looking to add Tussaud's Finance asset-backed securities to its Solus High-Yield Fixed-Interest fund, says Kevin Doran, fund manager. The planned purchase is part of Solus' strategy to build up its cyclical exposure. Tussaud's has exposure to consumer risk, but given the nature of the business, the long time it has been in operation, and its portfolio of well-trusted brands, the issue is defensive in nature, says Doran. Tussaud's Group securitized its tourist centers and amusement parks in 1999, and Doran is eyeing the single-A rated tranche that trades roughly 130 basis points over gilts.

Lenders are increasingly using credit default swaps to gain exposure to investment-grade loans, forgoing traditional participation in the primary market. Selling protection essentially gives the seller the same credit risk as direct participation in the loan, but the premium on the protection far outweighs the skinny pricing on investment-grade loans. Banks hurt by recent events in the investment-grade market are now looking at the same risk with better return, and LIBOR plus 12.5 basis points just doesn't add up.

The cost to corporates for interest rate and foreign exchange swaps could increase as more firms plan to use credit derivatives to hedge counterparty risk on these transactions. Interest-rate and foreign exchange desks at Bank of America, Lehman Brothers and UBS Warburg are looking at entering credit derivatives to price swaps more accurately and increase their credit lines. The move is spurred by the general deteriorating credit quality of corporates, said firm officials. The exact impact on swap pricing could not determined, one banker said pricing could even improve for highly-rated credits.

ABN AMRO has hired two research professionals from the former Gen Re Securities for new roles in its U.S. fixed-income derivatives team in New York. Reza Gharavi, fixed-income quantitative analyst at Gen Re, started last week as a director in fixed-income derivatives research. He said his role at ABN is not strictly defined yet but expects it will include a mix of interest-rate and credit derivatives research. L. Sankarasubramanian starts at ABN as a credit derivatives researcher after the Labor Day holiday. He had a similar role at Gen Re, which announced in January it was shutting its doors and has been unwinding positions and offloading personnel since (DW, 2/22).

Commerzbank Securities plans to expand its equity derivatives offerings and begin selling exotics such as correlation and volatility trades to the hedge fund community as part of a broader restructuring in its internal derivatives salesforce. Sam Gottesman, head of derivatives distribution for the Americas in New York, said the initiative to move into exotics follows the hire of Michael Belbeck, a senior equity derivatives marketer and structurer at Credit Suisse First Boston in New York, as a senior hedge fund salesman who will focus on selling equity derivatives.

ABN AMRO and Deutsche Bank are looking to issue warrants in Taiwan for the first time before year-end after recently receiving licenses from the Securities and Futures Commission. "There's definitely demand," said an official at ABN. "They're big names and should attract investors", said Ching-Pin Liou, head of derivatives at Yuan Ta Securities in Taipei, a domestic warrant issuer.

Bank of America has hired David Singer, interest-rate derivatives trader in the emerging markets group at ING Financial Markets in Hong Kong, as a group of seven forwards trader in Singapore as part of an expansion for its fx business. Lee Chee Pin, head of foreign exchange at Bank of America in Singapore, said the hire is part of a global strategy to boost its foreign exchange division. He added that BofA is considering adding one or two additional fx traders to its desk in Singapore.

Prices for credit protection on Malaysia have fallen and volumes rocketed after Standard & Poor's upgraded the sovereign. Malaysian credit protection traded five to six times around the announcement on Tuesday, in comparison to a typical week where Malaysia trades about once a day. "Quite a number of trades went through," added a trader at Salomon Smith Barney.

Derivatives houses, including Deutsche Bank, UBS Warburg and JPMorgan, have seen demand for hybrid structured notes in Singapore increase by approximately 30% as end users look to pick up enhanced yield before year-end. Bryan Yap, Asian head of interest-rate swaps at Deutsche Bank in the Lion City, said "This is a new development in Singapore." On average about 10 to 15 notes are structured per month, said one marketer.

Five-year credit-default swap spreads on energy giant El Paso Corp. tightened more than 200 basis points last week as positive news emerged out of the embattled energy sector. Protection on El Paso narrowed to 750-850 basis points Wednesday from 1,050bps Monday, according to traders. "El Paso has revised some of its financing, so its liquidity has improved and there's some positive sentiment coming out of the sector as a whole," said one New York trader.