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Taplin, Canida & Habacht will swap $200 million, or 10% of the firm's corporate bond portfolio, out of double-A rated financial bonds into triple-B cyclical corporates. Bill Canida, portfolio manager with the Miami-based firm, reasons that the economic recovery will cause cyclical bond spreads to tighten while rising interest rates will adversely effect banks and brokerage names. There is no particular trigger for this move besides the assumption that the economy is bound to recover soon. Canida says he is selling double-A five- to 10-year financial bonds at spreads over Treasuries inside 50 basis points. His buying target for the triple-B cyclical 10-year bonds is 500 basis points over the curve or higher. Those are trading at 400 basis over the curve as of last week.

Life is tough for those on the lower rungs of the loan market. While the senior members of desks across the country took off to spend the holiday weekend with their families, their younger counterparts stayed on to man the phones the Friday after Thanksgiving. One unlucky market player shared a sob story of having to give up an exotic vacation, even though experience has taught him that at the last minute his boss would tell him not to come in.

This chart, provided by Citibank/Salomon Smith Barney Inc., tracks bid-ask prices for par credit facilities that trade in the secondary market. It also tracks facility amounts, ratings, pricing and maturities.

SEB Investment Funds is looking to reverse its barbell strategy in its E3.75 billion fund managed out of Frankfurt. Once 10-year Treasuries yield 4.5% and 10-year European government bonds yield 4.75%, the firm will return to a neutral duration position, by buying back into the 10-year portion of the yield curve, says Martin Hochstein, head of fixed income. The move could happen by year-end, he says.

CIT Group is preparing to shop a $100 million credit under a tight deadline as part of Sterling Chemicals' exit strategy from bankruptcy, scheduled for year-end. CIT is fully underwriting the line and expects to launch syndication of the five-year revolver by mid-December in order to close out the line in time for Sterling's emergence, said Paul Vanderhoven, Sterling's cfo. He noted, however, that the reorganization plans are not contingent on the line's timely closing. Sterling does expect CIT to close the deal by the end of this month, Vanderhoven affirmed, despite admitting that December is not the most optimal time to launch and close a new credit. Calls to CIT officials were not returned.

Michelle Tan has been let go from Credit Suisse First Boston where she was a v.p. collateralized debt obligation structurer, according to a person at the firm familiar with the situation. She reported to Chris Ricciardi, managing director and head of structured credit products. Tan could not be reached for comment and Ricciardi did not return calls. It could not be determined whether her slot would be filled. Ricciardi's group originates and structures all CDO deals that are not backed by high-yield bonds, which includes investment-grade, structured finance or alternative CDOs.

Buysiders have scarfed up Del Monte's $500 million "B" piece and $300 million senior secured floating-rate note, oversubscribing the tranches within days of launch. The $1.4 billion debt package hit the market on Nov. 21, and the institutional tranches filled by last Monday, said a banker. It is still too early to determine if a downward flex on the prices would materialize, he added. The "B" loan is priced at LIBOR plus 4%, while the syndicated note is priced 1/4% higher. The note has the same collateral package as the bank debt but is noncallable for five years, according to a buysider (LMW, 11/25).Thomas Gibbons, senior v.p. and treasurer of Del Monte, did not return calls.

Deutsche Bank has placed two commercial mortgage-backed securities traders, Jake Markman and Paul Mashikian, on administrative leave pending an investigation into mispricings of the firm's secondary trading positions, according to firm spokesman Ted Meyer. An individual with knowledge of the situation says losses incurred as a result of the traders' activity will amount to over $30 million by the time they are fully unwound.

Eraj Asadi, executive director and head of asset-backed commercial paper at New York-based Rabobank International, says he wants to grow issuance levels for Nieuw Amsterdam, the bank's ABCP program to $6 billion a year. This represents a 50% increase from the $4 billion conduit's current size. The conduit's initial size was $1 billion in 1999.

The European secondary asset-backed market has been "subdued" as investors and dealers alike have been inundated by new issuance, say London-based ABS traders. One investor says he has been looking at every new ABS deal that comes across his desk--roughly E6 billion worth over the past three weeks--and has not been able to look at secondary market trades. "There are some secondary positions that look interesting, but our resources are really stretched right now. I'll look at them later," he says.

Merrill Lynch is in the process of merging its cash flow and synthetic collateralized debt obligation businesses, according to a senior banker at the firm. The change is being done to avoid "double pitching" the same collateral managers and investors for business. The banker says that an internal memo announcing the change was imminent as of last Wednesday.

PIMCO is marketing its second European collateralized debt obligation, which is set to be priced in the coming weeks. The E264 million deal, called Euro Multi-Credit CDO, will feature euro-, sterling- and dollar-denominated securities, say bankers familiar with the deal. The CDO will be backed by asset-backed securities, and will represent PIMCO's third CDO of ABS. PIMCO will use euro-denominated asset hedges to manage its foreign exchange risk. Calls to Mark Hudoff, London-based CDO manager at PIMCO, were not returned.