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Deutsche Bank continues to push through the exit financing for Dade Behring. In an effort to get the financing done, the bank has increased pricing on the $450 million "B" term loan by 75 basis points. A source said the credit, which includes a $125 million revolver, has been affected by a "pretty dramatic swing" in the market away from issuers and in favor of investors. Pricing on the "B" piece now rests at LIBOR plus 41/ 4%. A Deutsche Bank official declined to comment.

Qwest Communications International rallied from the 58-62 level last week after the company announced that it had completed the sale of its directories business, known as QwestDex. Traders quoted the company's bank debt anywhere from the mid-70s to the mid-80s earlier in the week, and trades were rumored to have been completed in the 80-82 range by week's end.

Prices for credit protection on Malaysia have fallen and volumes rocketed after Standard & Poor's upgraded the sovereign. Malaysian credit protection traded five to six times around the announcement on Tuesday, in comparison to a typical week where Malaysia trades about once a day. "Quite a number of trades went through," added a trader at Salomon Smith Barney.

BNP Paribas and Barclays Capital say the medium-term swap rate is overvalued and recommend investors take long and short exposure to take advantage. BNP is pitching a butterfly trade, which is where an investor would either purchase or sell swaptions in the middle portion of the curve and then do the opposite in the outer ends, or wings, of the curve. Barclays is also recommending a butterfly trade, specifically one executed with a straddle structure.

Credit-default protection on telecom companies tightened on Tuesday, grinding in even further Wednesday morning. The moves were sparked by the credits' improving equity performance and investors showed comfort that companies have begun to take needed write-downs from investments in third-generation licenses, said traders in London. In addition, Deutsche Telekom announced it was on track to report higher full-year earnings compared with last year, which tightened the price of its five-year protection to 270 basis points/280bps on Wednesday morning from 295bps/300bps on Monday, according to traders.

Charter Communications' bank debt took a five- to seven-point hit after the company revealed that it has received a grand jury subpoena from the U.S. district attorney's offices for the Eastern District of Missouri. The investigation is focused on Charter's current and disconnected customers and its policies and procedures relating to the capitalization or expense of various costs and related matters, according to a company statement. By midweek, the market for the name had sunk to the 80 1/2 - 82 3/4 range, with a couple of small trades occurring in that context. Callsto Kent Kalkwarf, cfo, were referred to a spokesman, who did not return calls by press time.

Valuation Inputs

A group of senior Bank of America equity derivatives executives that defected earlier this year are putting the final touches on their first hedge fund, Laurel Ridge Partners (DW, 2/26). The team, led by cio Van Nguyen, former business manager of the equity derivatives trading group at BofA in New York, is planning to launch the fund this quarter, as well as its offshore entity Laurel Ridge International, with USD200 million in committed capital from outside investors. Nguyen declined to name the investors but added that the firm is looking to cap the pair of funds at USD250 million.

Barclays Capital has hired Andrew Whittle, senior managing director of credit derivatives at Bear Stearns in London, as its European head of credit derivatives. This is a new role, said a spokesman, noting that previously the European credit derivatives team had reported directly to Vince Balducci, global head of risk finance in New York.

Bear Stearns is recommending clients buy dollar calls against the Singapore dollar in the short term and UBS Warburg and Commerzbank also expect a fall in the Sing dollar. James Fauset, v.p. in foreign exchange at Bear Stearns in London, said the bank has been recommending two-month U.S. dollar calls with a strike at SGD176.5, when spot was at SGD174.50 Wednesday. He said the firm has been advising hedge fund clients to put on such trades. As the global economy slows, he expects Singapore dollars to weaken more than other Asian currencies because of its dependence on exporting globally. Fauset added that volatility in the currency is usually low, around 6.3%, so the premium is only 0.50%.

Bank of America has hired Tony Kay, head of non-Japan Asia credit derivatives trading at UBS Warburg in Tokyo, to oversee credit derivatives trading for the region. "He's a top-notch guy," said one market official. Kay is reportedly receiving a two-year guarantee of USD2 million per annum. "This sets a whole new benchmark for the market," the official added. However, another official said, "They're paying over the top." Kay could not be reached for comment.

Firms selling protection to structure synthetic collateralized debt obligations caused credit-default swap spreads on high-grade names to grind tighter on Wednesday morning. Traders said that there were at least two deals, Merrill Lynch's Nationwide Building Society CDO and one from BNP Paribas. The Merrill Lynch deal is a synthetic balance sheet CDO referenced to Nationwide's EUR1.4 billion (USD1.38 billion) bond investment portfolio (DW, 4/28). The average credit rating on the deal is A3/BBB plus. Officials at Merrill declined comment and officials at BNP Paribas did not return calls.