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Owens Corning's bank debt was a few points lower this week after the company filed its plan of reorganization and a couple of lenders were looking to unload the name. A $20 million piece was believed to have changed hands around the 63 1/2 level, but the trade could not be confirmed. Market players said the name was softer after the company filed its reorganization plan because asbestos liabilities were larger than expected. The reorganization plan provided for $16 billion in asbestos liabilities, a company spokesman said. He also noted that proposed allowance to asbestos liabilities outstripped the value of the bank and bond debt and reduced the overall estate. A disclosure statement is set to be filed on Feb. 28, but there is no current date for emergence from Chapter 11.

Bear Stearns and Merrill Lynch are launching retail syndication Penn National Gaming's $800 million acquisition credit this Thursday. Pricing on the $600 million "B" piece is LIBOR plus 3 1/2%. When launched at the managing agent level, the spread was LIBOR plus 3%, said a banker familiar with the deal. The spread on the $100 million revolver and $100 million "A" piece increased from LIBOR plus 2 3/4% to LIBOR plus 3%. The banker said the pricing increases are in sync with the expected B+/B1 ratings on the credit. The banker expected the ratings to be released later this week. Multiples are 3.1 times senior leverage and 4.7 times total leverage. Bear Stearns and Merrill bankers declined comment.

ABN AMRO has made its collateralized debt obligations business a joint venture between credit trading and asset-backed securities in a move that will significantly boost the firm's CDO structuring and sales capabilities. "This means no fussing and mussing over CDOs," said John Mullen, global head of structured credit markets in London. Putting CDOs in one group across trading and ABS broadens the choice of assets available as reference entities and simplifies the hedging and sales process, explained Niall Cameron, global head of credit markets in London. Fernando Guerrero, global head of CDOs in New York, now reports jointly to Cameron and Mullen. Previously securitizations with an ABS bent were in Mullen's group and those referenced to default swaps were under Cameron's domain.

Barclays Bank has hired Elizabeth Goodall, interest rate saleswoman at JPMorgan in London, and Biraj Parmar, finance director at UKprocure, a supplier of products to the public sector, in London, as senior treasury advisors in its derivatives sales team in London. The bank also plans to bring more staffers on board in the same area. Goodall and Parmar report to Tim Kirkham, head of derivatives sales in London. Goodall, who started last week, and Parmer, who starts this week, were both on a training course and could not be reached.

Bank One is rebuilding its foreign exchange options business and has hired Justin Foley, global head of foreign exchange options at Bank of America in Chicago, in a similar role to expand the team in Chicago and London. Foley said the bank is planning to hire two or three options traders in London, including someone to head the desk, and three or four traders in Chicago. The firm plans to have half of the hires done by the end of the first quarter and most in place by the end of the second quarter.

Suncorp-Metway, Australia's sixth-largest bank with over AUD27.3 billion (USD15.9 billion) in assets, is looking to make its credit derivatives debut in the next 6-12 months. "At the moment we'd use these from the point of view of balance sheet management," said Mark Gardener, senior manager of the interest rate management group in Brisbane. He continued, "There's newer people in the balance sheet area that are more prepared to look at credit derivatives," noting that they are more open to using newer products. The bank will look to purchase credit protection on domestic names to hedge its loan portfolio, which stood at AUD22.9 billion in June.

Bear Stearns recently structured a JPY100 billion (USD839.3 million) synthetic collateralized debt obligation--the firm's largest CDO in Japan. The static portfolio is referenced to 100 Japanese credits, according to participants familiar with the transaction. Officials at Bear Stearns declined comment.

Endeavour Capital Management, a USD600 million global fixed-income relative value hedge fund, has hired George Polychronopoulos, senior managing director and head of interest rate trading at Bear Stearns in London, as a director and trader for the fund in London. The fund uses interest rate swaps, and volatility derivatives, according to Polychronopoulos, who left Bear Stearns in September (DW 9/30).

Credit Suisse First Boston has nabbed Jerry Wood, managing director in fixed income and 20-plus year veteran of Morgan Stanley in New York, to work in a senior position in the firm's fixed income division. Officials familiar with the situation noted that Wood, whose remit includes interest rate derivatives, is close to CSFB's CEO, John Mack, having worked with him at Morgan Stanley. The appointment reflects Mack's on going effort to fill senior positions with loyal lieutenants. Wood didn't return calls. Mack's secretary referred calls to Cristina von Bargen, spokeswoman, who declined comment.

A recent survey of the weather risk management industry has indicated a global increase of 43% in the number of weather-based financial transactions and 72% in the notional value for such contracts, in comparison with the previous year.* In order to maintain this rapid expansion market participants have sensed the need to enhance the legal environment in which such trades are executed and, in particular, to create a standardized documentation structure for weather transactions. Such a structure would expedite trades and enable companies to dedicate resources to weather risk management in order to improve market liquidity. Nevertheless, the nature of the underlying presents a series of obstacles, which renders the standardization process a challenging task and requires industry participants to openly discuss ideas and experiences in order to reach documentary uniformity.

Credit Agricole Indosuez is launching the first credit-default swap index in Asia in the coming weeks and plans to market such structures as baskets linked to the product. "As we've been seeing more and more interest for credit derivatives in Asia, clients have wanted to benchmark the performance of their baskets or credit-linked notes," said Medes Ma, Asia credit trading manager in Hong Kong. Dubbed the CAI Asian Credit Index, it comprises 29 names from seven countries in non-Japan Asia and tracks their performance from Jan. 2. Five-year levels will be listed on credits from China, Hong Kong, Korea, Malaysia, Singapore, the Philippines and Thailand. The index, which will be listed on Indosuez's Bloomberg page, will be launched in the next few weeks, said Ma. He continued that sub-indices will be created in the near future, broken down by country.

UBS Warburg, Schroder Salomon Smith Barney and Deutsche Bank are recommending butterfly trades on the back of recent trades totalling around EUR1 billion (USD1.057) executed in the interest rate swaps market. The firms are pitching trades where investors receive fixed and pay floating in the 10-year portion of the curve and pay fixed and receive floating in the two- or five-year portion of the curve as well as the 30-year portion.