Search results for

Eric Langille, former co-head of credit derivatives trading at Bear Stearns in New York, has joined Commerzbank as head of flow credit trading, which includes credit derivatives. George O'Dowd, head of New York credit trading, who Langille reports into, said the hire caps off the German firm's U.S. additions. Commerzbank is now "at full strength," he noted. Langille, who declined comment, also reports to Michael Staveley, global head of credit trading in London. Staveley declined comment.

Crédit Agricole Indosuez is bulking up its convertible bond stripping group, with plans to expand in the U.S. and Asia and a recent addition in London. "The business is growing quite fast," said Loic Fery, managing director and global head of credit derivatives and structures in London. Zouhair Bechchar, director and head of convertible asset swap trading in London, said that given the increase in client interest and growing issuance, the bank is looking to set up a New York-based convertible stripping desk by the middle of next year. "We'll be putting a small desk there," said Bechchar, noting that it will look to bring in two staff for the effort, after the integration with Credit Lyonnais. He continued that CAI will hire an additional convertible bond stripper for its Hong Kong operation. Zouhair elaborated that the firm's activity in the convertibles stripping market has doubled in the last several months, with volumes now exceeding USD3 billion per month.

Magnolia Capital Advisors, which was reportedly told to liquidate up to USD120 million in positions by Bear Stearns, its prime broker, may have tried to end-run the order by effectively striking a repo agreement. Don Reinhard, ceo of the Tallahassee-based hedge fund, did not reply to a series of phone calls and e-mails seeking comment. Bear Stearns MBS chief Tom Marano declined to comment.

One-week and one-month implied volatilities for dollar/yen options reached five-year lows last week when they fell to 7.4% and 7.5% respectively. One-week vols had been trading around 8.5% with the one-month at 8.1% the week before. During the fall in vol the dollar stayed in its JPY118-120 range against the yen. Traders said vol was pushed down by rumors of large exotic range plays expiring.

Jason Megson, an equity derivatives trader at CDC IXIS North America in New York, has left the firm. Megson, who could not be reached, is not yet thought to have joined a competitor. His departure follows Quincy Evans and Christophe Thomas, who co-headed the firm's convertible arbitrage effort (DW, 7/13). Janine Shagoury, spokeswoman in New York, declined comment.

Investec Financial Products is selling a structured note with embedded options to give investors capital protected exposure to Nova Alpha, a fund of hedge funds. Andrew Irvine, head of structured investment products in London, said it is launching the product because of demand for capital preservation and interest in the hedge fund sector.

Goldman Sachs has hired Gilles Dellaert, credit derivatives structurer at JPMorgan in New York, for a similar role. Dellaert, who declined comment, is reporting to Shlomi Raz, v.p. in structured credit marketing, according to an official familiar with the move. Raz, who was traveling and could not be reached, joined the firm from JPMorgan earlier this summer (DW, 7/13). Bruce Corwin, spokesman in New York, did not return calls. Michael Dorfsman, spokesman at JPMorgan in New York, declined comment on Dellaert's replacement.

Seoul-based Korea Exchange Bank, with over KRW61.4 trillion (USD51.9 billion) in assets, is considering investing in synthetic structured credit instruments, including collateralized debt obligations. "It's an idea I have," said Hee Dong Kim, head of the financial engineering department in Seoul. Kim said he is planning to speak with international derivatives houses to gain a further understanding of CDOs and credit baskets.

KEB Commerz Investment Trust Management, with KRW2.7 trillion (USD2.3 billion) in assets, is gearing up a cross-asset class fund that will employ equity derivatives in the coming months. Jae Hyun Lee, head of equities, said it will trade such instruments as over-the-counter options, equity-linked notes and convertibles.

Merrill Lynch is structuring several innovative synthetic securitizations to tweak extra basis points out of a credit market in which the arbitrage opportunities have all but disappeared. Philippe Hatstadt, the firm's newly installed head of structured credit derivatives trading in New York, said investors are crying out for higher returns and the firm is looking at structural innovations and new asset pools to jack up yield.

Fixed-income hedge funds have started unwinding swaps and offloading municipal bonds to take profit after the recent surge in volatility. Ying Chen Li, director in the fixed income strategy division at Merrill Lynch in New York, explained that many hedge funds held short positions on LIBOR swaps as hedges for their portfolios. Under these trades they paid a fixed-rate based on LIBOR and received floating. As interest-rates declined over the last year the hedges had been losing money, however, recent rocketing volatility has put the trades in profit.

National Australia Bank has hired Jacqui Steel, a foreign exchange professional at Westpac Banking Corp. in New York, as head of institutional foreign exchange sales, which includes over-the-counter options. Robert Cone, senior v.p. and head of the markets division for the Americas at NAB in New York, said Steel has been hired as the Australian firm aims to pump up its U.S. fx sales coverage. Steel will start in October. She could not be reached for comment.