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Dresdner Kleinwort Wasserstein has hired Chris Koppenheffer, former U.S. dollar swaps trader at RBS Greenwich Capital, to head the firm's U.S. dollar swaps trading desk in New York. Koppenheffer said he is excited by the new role and hopes to expand the desk's business. Since Koppenheffer departed RBS Greenwich earlier this year the firm has hired two ABN AMRO professionals for similar roles, according to Doug Greenig, managing director and head of derivative products and agency mortgage trading in Greenwich, Conn. Steven Mullaney joined to head the U.S. dollar swaps trading activity and Bart Sokol is a U.S. dollar swap trader.

Credit derivative broker creditex has hired Frank Sweeney, high-yield bond broker at ICAP in London, to spearhead the firm's push into the high-yield credit derivatives market.

David Schwartz, head of structured products marketing at Dresdner Kleinwort Wasserstein in New York, has left to start a structured credit fund. Schwartz said the fund, dubbed Fairhaven Asset Management, will focus on the senior classes of risk across structured credit products, including synthetic collateralized debt obligations.

Under the proposed accounting rules companies have to isolate all the derivatives in every transaction and mark them to market. Charlotte Jones, partner at Ernst & Young in London, said, "This is a big task." Adding, "They could be in almost anything."

Conference speakers and delegates were undecided whether the huge administrative burden that companies would have to undertake to achieve favorable accounting rules for derivatives would be worth the manpower. So-called hedge accounting means that derivatives trades have been deemed hedges and can be accounted for in a way that minimizes earnings volatility.

HSBC has hired Thomas Poh, interest rate derivatives trader at ING Financial Markets in Singapore, for its Hong Kong hub in a similar role. Poh reports to Samuel Koh, head of Asian domestic derivatives trading in Hong Kong. "We needed more hands on deck for product development and market coverage," said Koh, noting that Poh will help boost the bank's interest rate trading book for the Philippines and Indonesia. In recent months HSBC also added a senior derivatives dealer from Citigroup for regional currency derivatives trading in Hong Kong (DW, 9/28).

Two former giants of the investment banking community pointed out that finance professionals are not looking for a genuine solution to the woes accounting changes are throwing up but are looking for a way to profit. "Most people here, accountants, lawyers and bankers, are trying to work out how they can make money out of this problem rather than what the solution is," said Jonathan Laredo, founder of Solent Capital Management and former head of structured finance for Europe and Asia at JPMorgan in London.

The International Accounting Standards Board plans to review the rules governing recognition and consolidation of special purpose entities. The treatment of SPEs is fundamental to the collateralized debt obligation and the wider credit derivatives arena, as can be seen by the current furor in the U.S. over FIN 46, an accounting rule that puts many SPEs onto fund managers' and banks' balance sheets. The process of removing assets and liabilities from a balance sheet is known as de-recognition.

ING Financial Markets is getting ready to move its Hong Kong-based fixed income trading, structuring and research operation to Singapore early next year. "We're centralizing all financial markets businesses in one hub," said Sheel Kohli, spokesman in Hong Kong, adding, "This makes sense from a business efficiency point of view."

"Most people here, accountants, lawyers and bankers, are trying to work out how they can make money out of this problem rather than what the solution is."--Jonathan Laredo, founder of Solent Capital Management and former head of structured finance for Europe and Asia at JPMorgan in London, commenting on derivatives professionals' reaction to the introduction of International Accounting Standards. For complete story, click here.

Korean non-life insurance firms have decided to make first their forays into global collateralised debt obligations next year. Officials at the KRW2 trillion (USD1.6 billion) Oriental Marine and Fire Insurance and the USD900 million Shindongah Fire and Marine Insurance, said they aim to get a higher return by diversifying into CDOs because yields from Korean bonds are too low.

Companies have been spared the need to publish comparable accounts for derivatives when the new rules go live in 2005, but conference delegates did not think the market would be so lenient. IASB dropped the need for comparable accounts because companies' systems were not ready, explained Peter Clark, senior project manager at IASB in London.