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Scott Adams, former v.p. and interest rate derivatives marketer at JPMorgan in New York, has joined Lehman Brothers as v.p. in derivatives sales. Adams reports to John Gallo, managing director in derivatives sales in New York, according to Kerrie Cohen, spokeswoman at Lehman in New York. Neither Adams nor Gallo returned calls. Adams exited JPMorgan in November after falling victim to a reduction in headcount (DW, 11/10).

Dresdner Kleinwort Wasserstein has added Shafin Moledina, credit-default swap trader at WestLB in London, in a similar role. Moledina now reports to Paul Lewitt, head of credit derivatives flow trading in London. Lewitt referred comment to Louise Beeson, spokeswoman for DrKW, who confirmed the hire. Moledina declined comment.

Sellers of protection in collateralized debt obligations should realize the limitations of rating agency analysis and undertake their own analysis before investing. Steve Baker, director at CDC IXIS Capital Markets North America in New York, told delegates that while ratings agencies require onerous stress tests, the process is not perfect and deals can be structured to pass the tests. It is impossible to stress test every potential outcome and investors need to understand these limitations, he said.

HSBC has restocked its Korea-based fixed income derivatives desk with several hires from rival Deutsche Bank. J.S. Park, a senior derivatives sales professional at Deutsche Bank in Seoul, has joined as head of derivatives sales. H.J. Woo, derivatives sales, has joined as a derivatives marketer for local currency products, and W.K. Kim, derivatives marketer, will join later this month in a similar position. The hires report to D.J. Lee, treasurer in Seoul.

HSBC plans to integrate its credit-default swap desk into its newly merged bond and loan trading operation and will likely start purchasing protection for its secondary loans portfolio as a result. The bank is running a pilot scheme under which the profit and loss from the plain-vanilla credit-default swap book is consolidated into the credit book, which includes eurobonds and secondary loans, according toClive Stevens, who will be co-heading the group with Mark Everett. The integration has been planned to give investors access to greater liquidity and also to better manage the firm's credit risk, Stevens added. Previously Stevens and Everett were heads of cash bond credit trading.

Dealers in the U.S. and Europe will accept different forms of reference entity guarantees in credit derivatives contracts under the International Swaps and Derivatives Association's 2003 Credit Derivatives Definitions. Although ISDA sought a global standard for guarantees, a consensus to adopt a proposed compromise did not emerge. Instead, ISDA approved a more basic supplement. Dealers in New York determined it was appropriate to trade on Qualifying Affiliate Guarantees only, due to the legal uncertainty of enforcing upstream and sidestream guarantees. While aware of the legal considerations, European dealers did not want to limit the range of credit protection products they could offer.

Over 100 risk management professionals met at New York's Millennium Broadway Hotel Monday and Tuesday for the Global Association of Risk Professionals' first credit and counterparty risk summit for the Americas. Karen Brettell, senior reporter, filed the following stories:

Crédit Agricole Indosuez has named Gin Lee, head of sales in Seoul, as its new treasurer after Y.J. Lee announced his retirement. Lee, who will also keep his existing role, said he joined the firm last year from BNP Paribas, where he was head of foreign exchange and short-term derivatives marketing in Seoul, to overhaul the fixed income and debt capital markets groups. He has hired several derivatives professionals as well as introduced new products (DW, 9/22). Most recently, Lee hired former colleague S.H. Kim, fixed income marketer at BNP in Seoul, for a similar role.

David Covin managing director in interest rate derivatives marketing at Merrill Lynch in New York, has headed uptown to JPMorgan to head the firm's financial institutional derivatives coverage. Covin reports to Chris Harvey, managing director, said Michael Dorfsman, spokesman at JPMorgan in New York. Dorfsman could not confirm whether Covin was filling a new position.

Fukoku Mutual Life Insurance Co., with JPY4.732 trillion (USD40.2 billion) in assets, is considering beefing up its synthetic collateralized debt obligation investments for its USD5 billion fixed-income portfolio in the coming months. "We just got started," said Ichiro Yamada, manager of the international finance department in Tokyo, noting that the firm recently purchased a USD10 million tranche of a synthetic CDO.

ABN AMRO has lost Rob Hayward, senior foreign exchange strategist in London, in recent weeks. Alex Evans, spokesman for ABN in London did not return calls at press time. Hayward could not be reached.

Standard loan agreements need to adopt transferability mechanisms as part of their standard documentation in order to bring the market liquidity that is a prerequisite for shifting large quantities of credit risk, for example through credit derivatives. Charles Smithson, partner at Rutter Associates in New York, explained that at present standard loan documentation assumes loans to be non-transferable.