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Melissa Parker, portfolio manager with Nelson Capital Management, says she will move 5%, or $10 million, of the firm's portfolio, out of agencies into top-tier corporates on the view that well-selected corporate names should perform well as the economy recovers.

Segall, Bryant & Hamill will look to sell corporate bonds while increasing its mortgage-backed securities allocation by about $60 million to move up in coupon. Jim Dadura, portfolio manager of $1.2 billion in taxable fixed-income, says the firm will start looking at 6.5-7% coupons in 30-year Fannie Mae and Freddie Mac bonds and 6-6.5% coupons in 15-year pass-throughs, probably after the Federal Reserve's first interest-rate hike. The firm will make the move in anticipation of an eventual decline in the rate of prepayments. Dadura says he expects the Fed's first move to occur late this fall, and he believes a 50 basis point hike is the most that will occur by year-end.

Bankgesellshaft Berlin (BGB), which manages E1 billion in fixed-income assets through its Luxembourg office, is looking at adding high-yielding, short-dated telco and auto paper. Marcus Volz, portfolio manager, says spreads are attractive on telco paper in light of the recent spate of bad news in the sector. He says he has no specific telco names in mind, but would like to buy after the bad news has been priced in. BGB is a buy-and-hold investor, and Volz says short-dated paper offers less risk, but still has an attractive yield.

Market players were not slow to condemn WorldCom and the corporate scandals that were coming thick and fast last week. But out of misery comes humor, according to Bloomberg. E-mails making the rounds of hedge fund managers include these proposed new accounting acronyms: EBITDA - Earnings Before I Tricked the Dumb Auditor; CEO - Chief Embezzlement Officer; and EPS - Eventual Prison Sentence.

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.

ABN AMRO has hired Terri Duhon, credit trader and structurer at JPMorgan in London, as global head of credit structuring and origination, according to officials. Duhon reports to Arne Groes, head of credit derivatives in London, who confirmed her arrival, but declined to reveal her specific role. Duhon, who started Monday, declined comment.

Robert Heathcote, managing director and European head of credit derivatives at Goldman Sachs, is returning to structuring cash and synthetic collateralized-debt obligations. Heathcote has returned to structuring transactions because the firm wanted a senior banker in that position, according to Rebecca Nelson, spokeswoman. Heathcote will be working with Alastair Borthwick, managing director. Borthwick said his role has not changed and he has been working on structured transactions for the past year. Heathcote declined comment.

Morgan Stanley has hired Irene Rodriguez, a director of fixed-income derivatives sales to Latin American corporates at BNP Paribas in New York, as an executive director in a similar role. Rodriguez, who started a few weeks ago, confirmed the move and said she is looking forward to working at Morgan Stanley, where she will sell a range of fixed-income products such as interest-rate, credit and foreign exchange derivatives to Latin American end users for liability management purposes. She declined further comment.

Credit-default protection on Vivendi Universal rocketed over 400 basis points wider on Tuesday morning in London as Moody's Investors Service announced a downgrade of the media company's long-term debt to Ba1 from Baa3. Swap spreads for five-year protection on Vivendi closed Tuesday at approximately 1,100 basis points, compared to 640bps in the morning, said traders.

Glenn Barnes, Merrill Lynch's London-based head of European structured credit, has left the firm, according to senior Merrill officials. Dale Lattanzio, managing director and newly appointed European head of global principal investing and structured finance, has assumed Barnes' responsibilities. One insider said Merrill decided to eliminate Barnes' position to remove a layer of management, given the relatively small size of its European operation compared to the U.S.