Pre-migration untagged articles

After weeks of vilification, the credit derivatives business fought back this week. Spokesmen lined up to denounce the attacks as unjustified and ill-founded.

Eight European cooperative banks are to try to restore confidence in the inter-banking lending market and have agreed to lend to each other on a three month unsecured basis.

Fitch Ratings announced that it would toughen up its global rating criteria for structured finance CDOs this week. Meanwhile S&P confirmed that it would be incorporating rating stability into its main ratings as proposed in July, resulting in lower ratings for securities with "cliff risk" such as structured finance CDOs and CPDOs.

Bank of Scotland wasted no time making use of the UK government guarantee on bank lending, issuing $521.65m equivalent of certificates of deposit in maturities between six months and a year yesterday (Thursday).

Bankers in Switzerland reacted positively to their government’s plans for stabilising and recapitalising the country’s banks. (See Equity, page 20 for more details).

Bank CDS spreads in the US screamed to lower levels in the wake of the planned recapitalization package yet the results announced by Citigroup and Merrill Lynch yesterday showed that the industry is far from being out of the woods.

The Ukraine government is seeking a loan from the International Monetary Fund for between $10bn and $15bn to help it stem the financial crisis.

As bail-outs in various major economies improve sentiment, it’s business (or in the case of banks, no business) as usual in the European commercial paper market. The Fed has released more details about how its SPV for buying CP will work, including the tight spreads it will charge. However, this only helps US borrowers and the ECB seems unlikely to do something similar, despite rumours to the contrary over the weekend. Should market participants just wait for sentiment to feed through?

Private equity firm TPG and UK retail king Philip Green are going head to head to try and pick up some of the assets owned by Baugur, the troubled Icelandic retail investment company. These include highly prized UK high street names, such as House of Fraser and Karen Millen, which were acquired through leveraged buyouts. But Icelandic banks were not the only ones who put up the financing — other European lenders to Baugur must also now figure out what this means for them. Read EuroWeek on Friday for more detail on how banks will be affected by Baugur’s woes.

German railway operator Deutsche Bahn is considering the sale of stakes in DB Mobility Logistics to institutional investors through private placements after shelving the IPO plans last week. Bahn is looking into an off-exchange deal, potentially with investment funds in China, Singapore and the Middle East. Is this the end of the Bahn IPO?

Despite the palpable relief which has greeted the decision by governments across the globe to directly inject capital into troubled banks, the US bond market is not jumping for joy yet. Only a $375m 5 year for PPL Electric has printed so far this week, and this was at levels broadly similar to last week.

Under pressure from EU governments, the International Accounting Standards Board has agreed to allow reclassification of financial assets from fair value to cost accounting in rare circumstances. The move brings International Financial Reporting Standards into line with US GAAP. EuroWeek finds out what it means for investors.