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Deerfield Capital Management is planning to issue a collateralized debt obligation of structured finance assets, and UBS Securities is underwriting the transaction, according to sell-side and rating agency officials. They said Chicago-based Deerfield, which was an active issuer of CDOs referenced to corporate credits but has not been as active in using structured finance assets as underlying collateral, is attempting to raise cash from investors to fund USD300 million in CDO liabilities. It will be backed by a mix of investments in various asset-backed sectors. Marketing on the transaction, dubbed Wolf Creek CDO, began late last month. The deal is expected to be priced later this fall.

Sean Mullen, senior marketer in equity derivatives, and David Himmel, high-net-worth salesman, have quit Commerzbank Securities in New York. Separately, a trader specializing in convertible bond-based trategies has returned. Himmel reported to Sam Gottesman, regional head of derivatives sales. He referred calls to Ed Mitchell, spokesman in New York, who declined comment. Mullen reported to Kumar Doraiswami, head of institutional sales, who did not respond to messages. Neither Mullen nor Himmel could be reached.

Crédit Agricole Indosuez has hired Alec Yin, interest rate derivatives trader at BNP Paribas in Tokyo, as a derivatives structurer in Hong Kong. Yin said he now handles structuring for interest rate and foreign exchange related products. He reports to Eddie Lee, head of fixed income in Hong Kong. Lee did not respond to messages.

Deutsche Bank has transferred Insuk Jung, head of trading in the global markets group in Seoul, to its Singapore hub Jung said he will take a regional fixed income derivatives trading role but declined further comment. He reports to Bryan Yap, co-head of emerging markets Asia for fixed income and derivatives trading in the Lion City.

One-month dollar/yen implied volatility shot up to 12.94% last Wednesday after settling down to 10.83% going into the weekend. The week before implied volatility had rocketed to 12.46% from around 10% after a statement from the Group-of-Seven most industrialized countries about exchange rate flexibility (DW, 9/29).

Dresdner Kleinwort Wasserstein is planning to structure what would be the first collateralized fund obligation referenced to an index of hedge funds. The CFO would reference one of the hedge fund indices, such as HFRX or Morgan Stanley Capital International, which investors can replicate, according to an official. "It's just a question of time," noted the official. Mehraj Mattoo, managing director and global head of alternative investments in London, declined comment.

Dresdner Kleinwort Wasserstein has started selling structured notes that reference German Bund/swap spreads to investors who believe the European economic recovery is just around the corner. A typical note pays a fixed coupon for the first two years and then switches to leveraged exposure to the Bund/swap spread, according to Achim Beck, managing director and head of derivatives marketing for Germany and Austria.

Foreign exchange investors are flooding into euro calls/dollar puts with reverse knock outs as the euro strengthens against the ailing U.S. dollar. One New York-based trader explained that purchasing the options gives clients a low-cost exposure to the single currency's surge.

The Japanese collateralized debt obligation market has stalled this year on the back of chronically tight spreads. In contrast, the number of European deals has rocketed. Moody's Investors Service rated 154 CDOs in Europe during the first half of the year compared with 83 in the same period last year, even though the amount of risk being transferred halved (DW, 8/24).

DSP Merrill Lynch is establishing an onshore Indian rupee interest rate derivatives desk and is looking to begin trading by year-end. "The Indian market is still in development mode," said Jayesh Mehta, head of debt in Mumbai. "There's lots of potential," he added.

Rafael Berber, former head of the global equity-linked group at Merrill Lynch in London, has been appointed to the new role of vice chairman of global capital markets and financing. Berber was displaced from his previous role following a reorganization that saw Simon Brookhouse, managing director and head of equities for the Pacific Rim in Hong Kong, head to London to take over Berber's responsibilities (DW, 9/14).