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AIG Trading Group has hired Carl Nabar, v.p. and head of exotic foreign exchange options for the U.S. at Credit Suisse First Boston in New York, as v.p. in foreign exchange options trading in Greenwich, Conn. The new hire is a move by AIG to build up its exotic options business, said an official familiar with the hire.

Baring Asset Management (BAM) is considering offering structured notes referenced to Baring Hedge Select Fund. "It's on the drawing board," said Tom Maier, head of BAM's alternative investment team in London. The asset manager is still ascertaining demand for the notes and Maier said it is too early to estimate the potential size, structure or timeframe. The firm is talking to several investment banks about structuring products on the USD100 million fund, noted Maier, declining to name the firms.

Jae Oh and Sunil Iyer, credit default swaps traders at Deutsche Bank in London, have left the firm's credit desk. Stephanie Smart, spokeswoman at Deutsche Bank in London, said Oh and Iyer are still employees at the firm. "They are currently in discussions regarding other opportunities internally," she said. Oh declined comment and Iyer could not be reached.

Bank of America is considering launching a structured credit hedge fund and has earmarked Paul van der Maas, European head of structured products in London, to run the fund. Liz Wood, a spokeswoman at BofA, declined comment and van der Maas did not return calls.

Glenn Blasius, managing director and European head of asset-backed syndication and trading at Bear Stearns in London, has joined structured credit hedge fund Christofferson Robb & Co. Blasius joins the fund as a managing director in London and will both trade and structure products, according to Richard Robb, ceo in New York.

Fund managers in Australia are snapping up credit-linked notes, spurring a three-fold increase in default swap volumes since the start of the year, reversing last year's market contraction. Gary Vassallo, head of derivatives at Macquarie Bank in Sydney, estimated his bank's CLN volumes have doubled. An Australian Financial Markets Association survey in October showed Aussie credit derivatives volumes had bucked a global trend and fallen by around 20% to AUD22 billion (USD13.3 billion) a year (DW, 10/28).

European structured credit derivatives professionals at Merrill Lynch, ABN AMRO, UBS Warburg and Citigroup plan to market their wares to retail investors for the first time. "Within 12 months, this will be a big market," according to Stefan Armbruster, head of equity structured products for Germany and Austria at ABN AMRO in Frankfurt. Retail investors have traditionally bought structured equity products, but with the equity markets tanking for three straight years, firms are starting to pitch products that offer investors high coupon payments and are turning to credit derivatives.

The Financial Accounting Standards Board is going to change the definition of what constitutes a derivative to prevent corporates putting funding gains in the operating section of their balance sheet. The change, which is part of an amendment due out later this month, will separate the funding element of derivatives, according to FASB official, who declined further comment.

Deutsche Bank has hired Brett Golledge, head of trading for European corporates and financials at Commerzbank Securities in London. Golledge will join the integrated credit trading (ICT) desk when he starts in the coming months, and will report to Antonio Di Flumeri, European head of ICT for non-emerging markets in London. Di Flumeri declined comment.

Andrew Feldstein, former managing director and co-head of North American structured products and derivatives marketing at JPMorgan in New York, is readying the launch of a credit hedge fund in June. The fund, which is yet to be named, reportedly will launch with assets of USD50 million and is predicted to grow to USD250 million by year-end. It will trade over-the-counter credit derivatives and adopt several credit arbitrage strategies, as well as invest in structured credit products. Feldstein confirmed his plans to launch a fund, but declined further comment.

Five-year credit-default protection on Ford Motor Credit tightened to 380 basis points last Wednesday from 460bps the previous week. The move came as a reaction to stronger-than-expected profits for the first quarter, said a New York-based trader. Protection on almost all autos moved in on the back of Ford, with a notable exception being protection on General Motors Acceptance Corp., which blew out Tuesday as the corporate warned it might not meet its earnings targets. Five-year protection on GMAC traded at 250bps Wednesday, out from 230bps two days earlier, said the trader.

Financial Security Assurance has started to review synthetic collateralized debt obligations again with an eye to reentering the guarantee market. Betsy Castenir, spokeswoman in New York, said the FSA is pursuing new business in the CDO market selectively, but declined further comment. The monoline pulled out of writing guarantees on CDOs last year, after sustaining losses, said market officials.