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Merrill Lynch has hired Jim Crimmins, managing director and head of the financial strategies group at Morgan Stanley in New York, as a managing director and senior derivatives marketer. Michael DuVally, spokesman at Merrill in New York, said Crimmins, who will start at the firm in early March, will work with interest rate, long dated foreign exchange and credit risk management for corporate clients. This activity includes interest rate swaps. Crimmins did not return calls.

Five-year credit-default swap spreads blew out 70-80 basis points early last week on ThyssenKrupp, the German industrial conglomerate, in reaction to Standard & Poor's putting the company's BBB credit rating on negative watch. The credit was trading at 220-240bps Thursday from about 150-160bps Monday, according to traders in London. Volume jumped three times to around 10 trades a day, said one dealer.

Marc Saffon, head of financial engineering at Société Générale Securities in Tokyo, has moved to Paris as head of financial engineering, ex-France. He reports to Denis Alexandre, global head of financial engineering in Paris, according to a spokeswoman in London. Reasons for the move could not be determined by press time. Alexandre and Saffon did not return calls.

McDATA Corp., a Broomfield, Colo.-based firm specializing in the production of fiber channel switches and software for storage area networks, has entered into a derivatives-based share option transaction in order to convert part of a recent USD150 million convertible subordinated notes issue into company stock. Linda Dellett, v.p. in investor relations, said under terms of the issue the notes are convertible into shares of McDATA's Class A common stock.

UFJ Bank, one of Japan's largest banks with over JPY76.1 trillion (USD860.7 billion) in assets, is gearing up to expand its credit derivatives trading desk in the coming months. "UFJ Bank is focusing on its trading section," said Hiroyuki Yoshizawa, head of credit derivatives trading in Tokyo, noting that the bank is looking to position itself for an expected increase in credit trading as the market continues to mature.

Skipton Building Society, with GBP6.6 billion (USD10.68 billion) in assets, is planning to begin using foreign exchange swaps for its GBP1.5 billion medium-term note program later this year. Richard Dickinson, balance sheet risk manager in Skipton, U.K., said the thrift funds its lending portfolio entirely in sterling, but would like to diversify its funding base and reduce costs by issuing in foreign currencies and using fx swaps to convert proceeds into sterling-denominated liabilities.

Wachovia Securities has hired Mark Kohn, an associate on the equity derivatives trading desk at Morgan Stanley, to work in a similar role in New York. Kohn declined comment. Todd Steinberg, managing director and head of equity linked products in New York, confirmed the hire and declined further comment.

"We took them to court because they did not pay up on a contract that we thought they should honor."--James Barratt, head of the credit group at Nomura International in London, explaining the motivation behind its court case against Credit Suisse First Boston. For complete story, click here.

Huge inflows into U.S. fixed income cash funds is keeping credit-default spreads tight when most credit derivatives traders would otherwise expect the possibility of war in Iraq to be forcing widescale spread widening. Concerns over a U.S.-led war would typically increase the volatility of credit-default swaps, however, since January the market has instead been seeing general spread tightening in tandem with increased anticipation of a U.S. strike against Iraq, noted one trader. The Walt Disney Co. is one name thought to be particularly susceptible to spread widening in the event of war, however traders noted that although it moved wider by around 10 basis points last week, standing at 110bps last Thursday, movement on the name has been tempered since the beginning of the year.

ABN AMRO and Deutsche Bank plan to separately launch identical unfunded swaps referenced to the iBoxx index, a European fixed income index jointly complied by seven market makers. The two firms are going to be joint market makers in the swaps, meaning that they will both make prices for investors, to offer more transparency and liquidity, according to officials at both firms.

The Credit Risk Mitigation subcommittee of the Basel Committee on Banking Supervision has said it will recommended that restructuring is not required as a definition of a credit event in credit-default swaps in order for the buyer to get regulatory capital relief, except where the protection buyer has no control over restructuring events. Robert Pickel, ceo at the International Swaps and Derivatives Association in New York, welcomed the move saying the decision demonstrates more latitude on the issue than Basel has previously shown. He noted, however, that the final say on the matter rests with the Basel committee.

Morgan Slade, former head of statistical arbitrage trading for the proprietary trading desk at Merrill Lynch, is reportedly in talks to join a fund run by Texan billionaires Sid and Lee Bass. Slade is predicted to start work on the Sid Bass managed BBT Fund, according to an official familiar with Slade's plans. Clive Bode, spokesman for the Bass brothers in Forth Worth, Texas, declined comment and Sid Bass could not be reached by press time. Slade did not return calls.