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Deutsche Bank and Credit Suisse First Boston closed out Rexnord Corp.'s $435 million credit line Monday with more than 50% oversubscription on the seven-year, $360 million "B" piece, according to a banker familiar with the deal. The "B" loan was trading over par the following day, he added. Pricing stayed at debut levels, with a LIBOR plus 4% spread on the "B" tranche, and LIBOR plus 3 1/2% on the six-year, $75 million revolver. In addition to what one buysider described as favorable pricing, the term loan also included amortization as a credit enhancement. A Deutsche Bank official declined to comment, while a CSFB banker did not return calls.

WorldCom's bank debt clamored upwards alongside of bond prices on reports that Rudy Giuliani has joined on with David Matlin of Matlin Patterson Asset Management to raise $1 billion to purchase WorldCom bonds. Several small pieces of WorldCom's bank debt traded in the 24-25 context last week as traditional distressed players looked to buy into the paper. The paper traded last week in the 22 1/2 - 23 1/2 range. The names of the players could not be determined. Calls to WorldCom and David Matlin were not returned by press time. Attorneys at Weil, Gotshal & Manges, the firm representing WorldCom, also could not be reached.

Tyco International's $2 billion, five-year revolver with February '06 maturity traded in the 90 context early this week. Its bank debt, which matures in February '03, was quoted in the 97-97 3/4 context and traders said the paper has been creeping closer to par as its expiration date approaches. The February '03 bank debt was a $3.855 billion, 364-day revolver that was termed out in February this year.

The phenomenal growth of the CDO market has lead to new structures, with investors moving away from the initial black box CDOs toward transparent ones, initially static and most recently dynamic, with substitution or a manager. This article addresses some of the more recent developments in the sector and the analytical challenges they present. Although we are aware there are a lot more issues that need to be reviewed by investors in every individual situation, space restraints have meant we have focused on the most important areas.

Nicolas Kello, managing director and head of investor coverage at JPMorgan in New York, has left the firm, marking one of the most high profile departures of recent weeks. Reasons for the move could not be determined by press time and Kello could not be contacted. Adam Castellini, spokesman in New York, confirmed the departure, declining further comment.

Monty Agarwal, Asian head of interest rate derivatives trading at BNP Paribas in Singapore, has resigned. Reasons for his departure could not be determined by press time but officials at the firm said T.S. Cheah, managing director and Asian head of derivatives and structured products in Hong Kong, has assumed responsibilities for the desk. Cheah did not return messages. Agarwal reported to Frédéric Janbon, senior managing director and global head of interest rates in London. Janbon declined all comment.

Bear Stearns has hired Shinichi Kaneko, equity derivatives marketer at Mizuho Securities in Tokyo, in a new role as an equity derivatives product specialist in Tokyo. Bear Stearns has been building up its Tokyo equity desk under Kin Sang Cheung, senior managing director and head of equity derivatives trading in Tokyo, who joined earlier this summer from Lehman Brothers to lead the effort (DW, 7/7). "I have a mandate to build up this business," said Cheung. He declined to comment on additional hiring plans. Kaneko was traveling and could not be reached.

Investment banks in Europe, including JPMorgan, Barclays Capital, Royal Bank of Scotland and ABN AMRO are intensifying their efforts to convince corporates that time is running out to prepare for a new accounting standard that will require them to mark derivatives positions to market. Although the International Accounting Standard 39 doesn't go into effect until 2005, bankers say compliance will require time-consuming wholesale changes in accounting procedures that will have to be in place by the end of next year. "A lot of these companies are just waking up," said Scott Wacker, global head of corporate distribution at ABN in Amsterdam.

Bank of America has transferred Chuck Doherty, head of global exchange arbitrage in Chicago, to Tokyo to assume the role of Japan head of global markets, looking after trading and marketing for its fixed income division. Doherty noted that he is replacing Kenichi Tatsuzawa, who recently resigned (DW, 9/24) and will start officially in Japan next month. Doherty said he will continue his role as head of global exchange arbitrage in addition to his new duties. He added that he is no stranger to Japan, having worked there previously for six years. Doherty referred further queries to the press office.

Five-year credit protection U.S. retailer Sears Roebuck jumped by more than 100 basis points last Wednesday versus the previous week's levels over concerns about the company's ability to access the capital markets. Five-year default swaps on Sears widened to 450 bps, up from 305-315 where they were trading the previous week, said one trader.

Credit Suisse First Boston is restructuring its credit derivatives operation in Japan and Asia, a move that will entail centralizing its Asia credit derivatives desk in Hong Kong from Singapore as well as moving its two most senior credit derivatives professionals in Tokyo to London. Headhunters and rival bankers said the move is part of CSFB's on-going effort to cut costs, directed by John Mack, ceo. Credit derivatives professionals at CSFB declined comment, as did Isamu Kajino, spokesman in Tokyo. Sanjeev Gupta, global head of credit derivatives in London, did not return messages.