Pre-migration untagged articles

The covered bond market suffered one of its most volatile days ever on Wednesday — in trading spreads and emotions — as hopes that a Eu2bn three year deal for HBOS would reopen the market were dashed by a market-making fiasco.

IKB Deutsche Industriebank said on Monday that it had adjusted its business model, returning to lower risk businesses after a failed dip into the asset backed commercial paper market, and said that it expected losses of between Eu600m and Eu700m, due to "hidden accounting losses".

The Kauri market continued to spread its roots this week with two more debut issues.

All credit to Jean-Pierre Mustier of Société Générale for trying to pour oil on troubled market waters in an enlightening interview with the financial press this week. To be honest, one can hear only so much from central bankers, and paying attention to market regulators is as interesting as listening to air escaping from a balloon.

One of the most dangerous overhangs in the capital markets teetered this week as Moody’s put the senior debt of several structured investment vehicles on review for possible downgrade, because of falls in the market value of their assets.

Moody’s placed the following notes on review for possible downgrade:

The agency downgraded the mezzanine capital notes issued by Cheyne Capital Management’s SIV, Cheyne Finance, from A3 to Caa2 and its combination capital notes from Baa2 to Caa3. Both had been put on review for downgrade at the end of August.

The day of reckoning has arrived for some senior executives at the main investment banks. Several well known heads have already rolled, but there will be more to come.

Structured investment vehicles funding in the EMTN market have been posting wider levels recently, but few trades have emerged.

New issue flow in EuroMTNs dwindled again this week, and dealers blamed unrealistic issuers, rather than any lack of investor appetite for the lack of trades.