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Recent downgrades of Road Chef and Welcome Break, two landmark whole business securitization deals of roadside service complexes in the U.K., could put a damper on the market's appetite for these kinds of deals and bring closer scrutiny from ratings agencies, London-based bankers say. Last week, Fitch Ratings downgraded Road Chef's two single-A tranches to triple-B+, and its triple-B tranche to double-B. Welcome Break had four single-A tranches downgraded to triple-B+ and one triple-B tranche downgraded to double-B. Fitch noted that both companies are coming close to the danger zone in terms of being able to service their debt.

Total investment grade issuance for the week was $12.5 billion, with a big surge as a combination of Greenspan's testimony and better-than-expected economic data made spread product more attractive for investors. Highlights of the week include the 3-tranche $3 billion deal for National Rural Utilities (A2/A), which had a tough start but ended up pricing 5-7 bp inside of original price talk as the market mood improved. Heinz (A3/A) also took advantage of the surge in demand for corporates bringing $1.25 billion of 10- and 30-year debt into a hot market. The deal was a blowout, launching and pricing in the space of a few hours. Despite the high profile accounting blowups that have plagued some of the benchmark borrowers in the corporate bond market, there is still clear appetite for better quality borrowers and investors still have money to put to work.

Société Générale is structuring a EUR300 million (USD261 million) arbitrage synthetic collateralized debt obligation. An investor in London said the portfolio consists of credit-default swaps referenced to 54 European and six U.S. blue chip corporates. He added, there is no exposure to the airline or gaming industries.

In last month's Australian deals of the year, we opted for a transaction that was daring and unique. Rather than look at the handful of IPOs that had taken place in the course of the year, or the larger secondary deals from the likes of Macquarie Infrastructure Group, we gave our equity award to the insurer, QBE. QBE, like all insurers, was hit badly by the September 11 attacks on New York and Washington DC. Quite apart from the insurer's exposure to the disaster, QBE's share price took a battering during the uncertainty that followed, dropping from A$10.21 to A$3.28. If the company was to keep its capital base solid, convince investors of its strength, and take part in any later upswing in the insurance markets, it needed to raise new capital. It therefore went to the market with an A$663 million (US$342.3 million) rights issue, becoming one of the first issuers after September 11 to attempt to access the markets.

Australia has one of the best-performing economies in the developed world – saved, in many respects, by the things that were causing consternation and criticism a year or so ago. Chris Wright reports.

Asiamoney met with Ian Macfarlane, governor of the Reserve Bank of Australia, in Sydney in February. On the agenda was Australia's economic performance relative to the rest of the world – strong in every sense except the currency.

The predominant theme of the Australian debt capital markets for the last three years – the gulf between supply and demand – is set to become much more pronounced this year. Chris Wright reports.

The Reserve Bank of Australia has announced the country is out of trouble economically. The state of New South Wales is particularly well positioned to enjoy this renewed growth – it may argue, in fact, that it was never in trouble in the first place. Asiamoney's Fiona Haddock met with its long-serving premier, the Honourable Bob Carr, in Singapore.

In previous editions of this supplement, we have interviewed government ministers and members of Axiss Australia on the merits of Australia as a financial centre for the region. This year we decided to do something different: ask the CEOs of the banks that have tried it. They seem to like it.

People is what investment banking is all about. But until recently, the investment banking arm of the Bank of China, BOC International, has been rather thin on the ground when it comes to matching the calibre of staff at such global institutions as, say, Goldman Sachs or Merrill Lynch. This is fast changing. Over the lunar new year, the Chinese bank embarked on a hiring spree. Five seasoned bankers were lured from other major banks as the institution girds itself for post-WTO expansion.

CNOOC shows hunger for China debt

The already depressed Asian FX sector continues to slow this year. Drivers for this fall include the introduction of the euro, consolidation of the banking industry in Asia and the growing role of electronic brokers in the spot interbank market. By Joy Lee.