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HSBC Bank, a relatively new entrant to the European securitization market, is setting its sights on becoming an important market player. After a slew of hires made last year to fill senior positions on the securitization team, the firm is now looking at garnering a spot on the European securitization league tables, according to Robert Drutman, London-based head of European structured product syndicate and product manager.

A $35 million piece of Xerox Corp.'s revolver, "A" term loan and "B" tranche was auctioned off last Thursday for a combined price of 93 1/2, according to dealers. Bank of Ireland is believed to have sold the paper, but a buyer could not be determined. There was no event that triggered the sell-off, according to market players. Some traders suggested that the price of the bank debt has been climbing up and the bank simply gained approval to sell off the paper. Individually, the revolver has been trading in the low 90s up from the mid-80s. The "A" and "B" pieces are quoted as high as 95-96 up from the low-to-mid 90s levels, where they were trading late last year.

Fleming Companies' bank debt slipped down to the 93-94 range last week as investors grappled with the company's downward-revised fourth quarter earnings estimates and the pressure from Kmart store closings. The paper had been quoted in the 97-98 1/2 range before the announcements. "The bonds got hammered 15 points," noted one trader. The company's 101/ 8% notes were quoted in the 74 1/3- 74 2/3 range when LMW went to press. Fleming revised its fourth quarter earnings to 10 to 12 cents per share, down from its October estimates between 35 and 45 cents per share. "Fleming receives 20% of its revenues from Kmart and Kmart is closing half of its superstores," added one trader. Calls to Fleming officials were not returned by press time.

Banif, one of Portugal's largest banks, is readying its first residential mortgage-backed securitization, according to London-based bankers. The deal, which should be about E500 million, will come to market in the coming weeks and is being lead-managed by Credit Suisse First Boston and Deutsche Bank.

Rumpke Consolidated chose Bank of America to lead its new $110 million credit facility, allowing the company to refinance debt that included a high-interest subordinated piece. B of A replaces incumbent General Electric Capital Corp., partly due to B of A's prominence in the waste industry. "Bank of America is widely known and respected in the waste industry," said Phil Wehrman, Rumpke cfo. In addition, "GECC is considered by some to be a lender of last resort. We thought we would have a better chance of success to fill the facility [with B of A as lead]," he explained. GECC did, however, take on a large exposure to the new credit, he added. Calls to GECC were not returned.

The recent high-yield rally has provided investors with an opportunity to pick up the bonds of Lyondell Chemical Co. at a discount to its peers in the sector, says a sell-side analyst. However, at least one portfolio manager is not ready to increase his allocation to the credit, which is a benchmark issuer in the high-yield chemical sector.

Simplicity Manufacturing has completed its largest credit facility-- for $135 million-- in more than a decade to back its acquisition of lawn mower manufacturer, Snapper, for approximately $56 million. Don Schoonenberg, executive v.p. of finance and administration at Simplicity, a portfolio company of private equity firm Kohlberg & Company, said it's the company's first syndicated facility since the 1980s. Because the lawn mower and tractor maker had much smaller credits in the past, its facilities had been club deals, explained Al Meier, executive v.p. at Fleet Capital, lead bank on the deal. Fleet has been doing business with Simplicity since the early 1990s, Schoonenberg added. The new line replaced a previous $45 million revolver, he further noted.

Standard & Poor's has hired Ellen Collins as senior collateralized debt obligation analyst for its CDO manager focus group, which is headed by Mark Gaw, associate director. Collins joins as associate director. She started last Thursday. The position is newly created as the group is expanding (BW, 10/13). Gaw says the addition of Collins brings the number of analysts who work under his supervision to three. He says that he will be adding a fourth by the end of this quarter. The group provides reports on CDO collateral manager's performance relative to their peers.

Levels for Tesoro Petroleum Corp.'s bank debt ticked up in the secondary loan market last week as the paper rose from the low 90s into the 95-97 range. Traders said no paper changed hands. One trader suggested the name was climbing on the back of Premcor, a St. Louis-based company that is currently pursuing an acquisition of the Williams Company's Memphis refinery. In addition, crack spreads have held their ground, he added. Tesoro's $1.275 billion credit facility is led by Lehman Brothers. Calls to Sharon Layman, Tesoro v.p. and treasurer, were not returned by press time.

Accounting experts and collateralized debt obligation analysts say low interest rates and an arcane accounting rule will prevent the number of CDO write-downs from ballooning. They say that even with the avalanche of downgrades affecting the CDO collateral, low interest rates support high valuations on the CDO bond prices. Low interest rates also provide accounting relief as they increase the price of other fixed-income instruments. Since CDO performance is booked on a net basis, losses in CDOs may be offset by profits on other bonds in a portfolio and never appear on the books. This is reinforced by the Emerging Issues Task Force rule 99-20, governing CDO write-downs, which analysts say, leaves a lot of room for interpretation. Finally, the lack of transparency in the CDO secondary market allows investors to avoid booking their CDO performances as losses, as they inflate the market value of their CDO notes.

The Loan Syndications and Trading Association elected its 2003 board of directors and board officers at its annual meeting last week. Glenn Stewart, managing director and head of loan syndicate for Banc of America Securities is the new chairman, whileCredit Suisse First Boston'sDon Pollard, managing director and head of loan syndicate, is the vice chairman. Stewart replaces Linda Bammann, chief risk officer ofBank One. Mike McAdams, President and CIO of Four Corners Capital Management, was last year's vice chair.