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Source: www.bondweek.com

Alternative Asset Advisors, a Swiss hedge fund manager with USD900 million in assets under management, has structured an equity-linked note that uses over-the-counter equity derivatives. Tony Morringiello, ceo in Geneva, said the five-year capital-guaranteed notes are referenced to its fund of global diversified hedge funds, known as ACE. He referred further queries to officials in the fund derivatives group at BNP Paribas, which structured the deal.

Income Partners Asset Management (HK), a fixed-income fund with USD550 million under management in Hong Kong, is considering issuing its first synthetic collateralized debt obligation in the coming months. The CDO will be structured entirely on Asian credit-default swaps. "We've got the technology to do this in-house," said Francis Tjia, executive director. Income Partners currently has four cash collateralized bond obligations in its investment portfolio, totaling USD400 million, of which two were structured in-house.

AMP Henderson Global Investors, one of Australia's largest asset managers with over AUD66 billion (USD35 billion) under management in Sydney, is considering trading credit-default swaps in Australia for the first time for its AUD25 billion fixed-income portfolio. "We're turning our energies toward credit-default swaps," said Mark Beardow, manager of credit. He added that the fund could invest in credit-default swaps within six months. AMP will consider buying as well as selling protection: "I'm open minded, we'll consider all options and applications," said Beardow.

The San Diego Padres Baseball Club Limited Partnership, owner of the West Coast Major League Baseball team, is considering pulling the trigger on an interest-rate swap following its planed USD150 million debt offering, according to Fred Gerson, cfo. Proceeds from the debt offering, which is expected to hit the market by late April or early May, have been earmarked for the financing of the Padres' new stadium and to build additional infrastructure around the new ballpark, Gerson said. The company is planning to either issue a bond offering on the back of a bank loan it secures for the stadium or go directly to the bond market for the financing.

Citibank and Credit Lyonnais have separately sold what is considered to be the first won swaption-linked notes in Korea earlier this month. "Customers are attracted to the enhanced yield," noted an official at Citibank in Seoul. He continued that the bank is looking to issue additional notes, ranging between KRW100-200 billion (USD75-150 million) in size, either linked to the five or 10-year swaption rates. Officials at Credit Lyonnais confirmed that it also issued similar notes earlier in the month, declining to elaborate.

Computer Associates went ahead with a USD660 million convertible deal last week after bankers came up structured a call spread that helps mitigate the potential dilution of the company's shares through conversion. CA executives had been resistant to the idea of a convertible offering because they felt the company's stock was trading too low. They believed it would probably rebound to higher levels soon and they didn't want a low conversion price to lead to dilution.

Commonwealth Bank of Australia plans to start offering reverse convertibles to clients by year-end. The move is part of the firm's plans to increase its product range as it focuses on premium clients. "We're looking to expand the sweep of products we offer our clients," said Stephen Richards, head of equity trading and risk at CBA in Sydney. Richards estimated it could sell AUD50-100 (USD26.4-52.9 million) within 12 months of launching the product.

Credit Suisse First Boston has hired Georg Steinig, director in structured product sales to German and Austrian clients at Morgan Stanley in Frankfurt, in a similar role. Steinig will report to Stéphane Diedrich, co-head of German and Austrian sales at CSFB, according to a firm official. Diedrich was travelling and could not be reached.

American Capital Access has hired Joseph Pimbley, head of credit derivatives trading at Sumitomo Mitsui Capital Markets in New York, as a credit derivatives portfolio manager in its structured finance department. Pimbley started last Thursday and reports to Maryam Muessel, coo, according to Cathy Bailey, a spokeswoman at ACA. Muessel heads the structured finance group and overseas the firm's asset-backed security and collateralized debt obligation portfolio management and structuring. Pimbley will specialize in managing and structuring credit derivative products within that group, including CDOs. His position is a newly created one, reflecting growth in the structured finance business of ACA, said Bailey. The department may add more staff in the future but she declined to be more specific.

Deutsche Bank has set up a correlation-trading department in its global commodities group as part of its effort to become a leading commodities house. The firm plans to use its bulge bracket status in the foreign exchange and interest-rate derivatives market to sell commodity-linked products to investors who would not normally enter these markets, such as fixed-income hedge funds, pension funds and retail investors, according to Kerim Derhalli, global head of commodities in London.

Deutsche Bank entered up to USD1 billion (notional) of two-week U.S. dollar/Japanese yen 25-delta risk reversals Tuesday on behalf of a client, according to rival traders in London. A Deutsche Bank trader acknowledged the bank had executed a large customer trade where it bought upside dollar calls/yen puts struck at JPY133.85 and sold downside dollar puts/yen calls struck at JPY130. Spot was JPY131.5 Wednesday and had been as much as a full yen higher the previous day. The Deutsche Bank official declined further comment.