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Goldman Sachs plans to start a convertible bond sales and trading desk in Hong Kong, which will be headed by Jeremy Eakin, head of European convertible sales and trading in London. Eakin said he will relocate to Hong Kong in December, but declined further comment.

Goldman Sachs has hired Francesco Adiliberti, director at Lehman Brothers, as v.p. in equity derivatives sales in Zurich. Adiliberti reports to Johannes Sulzberger, managing director and head of the equities business in Zurich, and started on Oct. 1, according to a Goldman spokeswoman. Adiliberti had no comment and Sulzberger referred calls to the spokeswoman. A Lehman spokeswoman confirmed his departure but declined further comment.

Goldman Sachs has hired Adam Jones, asset swap trader at JPMorgan in London, to work as an executive director on its emerging market credit derivatives desk, according to Rebecca Nelson, spokeswoman at Goldman. Jones declined comment.

Galaxy Asset Management (H.K.), a Hong Kong-based hedge fund, is actively considering using equity-linked notes for the first time. "It's another way to use options," said an official at the firm, noting that such notes would give it leveraged exposure. He continued that Galaxy regularly trades listed futures and options and occasionally uses over-the-counter derivatives.

Hong Kong's Dao Heng Bank, which was acquired last year by the Development Bank of Singapore, is looking to market hybrid notes for the first time. "We're going to test the market," said Henry Chan, v.p. in marketing and product development in Hong Kong. He said that given the prevailing low interest rate environment, clients are looking for yield-enhancing products.

Interest rate swap volumes in India have roughly doubled over the last month in anticipation of further rate cuts. "Volume has picked up quite a bit," said Srinivasan Varadarajan, treasurer at JPMorgan in Mumbai. He continued that trading volume has grown to USD75 million per day in recent weeks from about USD30-40 million per day a month ago. He explained that much of the activity stems from interbank players putting on positions anticipating a rate cut when the Reserve Bank of India meets later this month. "People are looking to put on positions and ride it down," added Varadarajan. Interest rate swap levels have come down as well over the past few weeks, for instance five-year swap levels were around 6.55% a month ago and have fallen about 25 basis points since.

Merrill Lynch last week completed the removal of a layer of management closely associated with former global debt capital markets COO T.J. Limm, in a move widely interpreted as the firm's old guard reasserting its grip. In the latest reorganization Kevin Chattwell, managing director and head of the rates business for Europe, Middle East and Africa in London, was let go last week. Chattwell, who had worked with Limm at what is now Dresdner Kleinwort Wasserstein prior to joining Merrill two years ago, could not be reached. Richard Creswell, a Merrill spokesman in London, declined to comment.

Lehman Brothers is parachuting in Benoit Savoret, head of equities for Asia-Pacific in Tokyo, in a newly created role as head of European equity trading for both cash and derivatives to beef up its London-based operation. Lehman is reportedly revamping its equity derivatives business after plummeting global stock markets have resulted in a dismal year for equity desks, according to rivals. Francois Pham-Quang, head of European equity derivatives sales, who officially resigned last Friday but signaled his intention to leave last month, said the firm has decided to bring in Savoret to devote a senior manager to the group, in which he was the only managing director.

Korea's Samsung Securities recently hired Alex Choi, executive director in fixed income sales at Goldman Sachs in Hong Kong, in a new role as its head of the capital markets division in Seoul, to kick-start its derivatives business. "It's a very compelling opportunity," said Choi, explaining his reasons for moving. He will look to build up Samsung's newly-created division: "We're putting together proprietary trading, capital markets and derivatives under one division." Choi noted that for this initiative, he will establish a fixed-income and equity derivatives operation when Samsung receives a license in the next few weeks, hiring both traders and salesmen. "If any domestic firm has a chance to really succeed in the derivatives market, it's this one," he added.

"Hong Kong used to be a great hub but as turnover is down so much it really doesn't make sense when you're making more money outside of Hong Kong."--Dustin Kuo, head of index arbitrage trading at Barclays Capital Asia in Hong Kong, on why Barclays plans to close its Hong Kong equity derivatives trading desk and centralize all Asian trading in Tokyo. For complete story, click here.

TD Securities has hired Tom Mykityshyn, a veteran mortgage-backed securities salesman from Deutsche Bank Securities, to head up a new structured product sales effort for its New York office, according Harold Holappa, TD Securities' global head of structured products. Mykityshyn did not return phone calls seeking comment. Holappa said Mykityshyn will head a team of three and will be actively seeking additional hires for the group. He said the group will try and expand the bank's distribution of Canadian asset-backed securities to U.S. institutional investors, as well as selling collateralized debt obligations and credit-, equity- and interest-rate derivatives.

The cost of U.S. dollar/Japanese yen options increased last week as investors continued to show concern over the Bank of Japan's intended reform of the country's banking sector. "The Japanese government is likely to create an inflationary environment to try to force the yen higher, however with the Nikkei hitting a 16 year low last Tuesday, bottoming at 8,500, the banking sector also looks weak and professional money is betting on a weaker yen," noted one trader in New York. One-month implied volatility rose to 10.5% Wednesday, up from 10% the week before. One-year volatility increased to 9.75%, from around 9.5% in the same period. The pair traded at JPY124.24 Wednesday, up from JPY123 Monday.