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Phil Jones, the former global head of convertibles at Merrill Lynch, controversially resigned his post and moved into an apparently less senior position at Goldman Sachs this week. The departure is a U-turn for Jones, who just weeks earlier had said he was moving to Europe to spearhead a new focus on the region. Merrill Lynch bankers were shocked at the decision, claiming that despite the publicity behind the move, Jones had never been as interested in the European market. His new role at Goldman Sachs is based in New York.

Iran EuroWeek hears that a group of French banks is close to signing a $500m four year oil-related pre-export financing through the Iranian central bank, Bank Markazi.

Yields on mmO2's euro1 billion ($867.75 million) five-year note rose by 80 basis points on Tuesday after the firm announced that it would cut 1,900 jobs from its German and British operations over the next year. Traders pointed to poor overall market sentiment, as well as mmO2's job cuts, for the rise in yields. "There has been a huge melt-down in lower-rated telecoms, which isn't based on fundamentals but on a risk averse attitude by investors," said Peter Plaut, credit analyst at Bank of America. "Anything with a low rating and perceived risk is getting sold off." Mm02 issued the euro1 billion MTN on January 25 2002. The note pays a coupon of 6.375% and was closed off the company's newly signed euro5 billion Euro-MTN programme. The issuer overcame widespread scepticism about the inaugural benchmark Eurobond when the trade was more than five times oversubscribed. Investors were initially worried that the company's Baa2/BBB- ratings would come under pressure but a fully reversible step-up coupon clause, which can increase or decrease as mmO2's credit rating changes, was added to the deal. The issuer has $1.32 billion outstanding off its facility off two issues. MMO2's other issue was a £

* Don Wilson and Bill Winters, co-heads of global credit and rates markets at JP Morgan Chase, have been appointed to the firm's executive committee. Four other new members have also been promoted to the executive committee, namely Dina Dublon, the firm's CFO, Steve Black, head of public equities, John Farrell, from human resources, and Jes Staley, from investment management and private banking. Bill Harrison's senior management team now numbers 15 people. * Joonkee Hong, joint head for UBS Warburg's debt capital market group in Asia and head of Asian derivatives, will relocate to the bank's Stamford, Connecticut base at the end of April, to head up global emerging market derivatives.

Kuwait's biggest commercial bank, National Bank of Kuwait (NBK), has set a benchmark for other private sector Gulf issuers, with a $450m three year FRN via JP Morgan and Morgan Stanley. The bank used its strong Moody's ratings and its absence from the international loans market to achieve a tight 25bp over Libor for the transaction.

Bahrain Ashmore Investment Manage-ment has been in Bahrain promoting its new Arab Debt Fund this week. The Guernsey-based open-ended fund will invest primarily in sovereign debt from the Middle East and North Africa, and is targeting the buoyant demand within the region for fixed income exposure.

* Landesbank Rheinland-Pfalz Girozentrale Rating: Aa1/AA/AAA

Pfandbriefstelle der Osterreichischen Landes-Hypothekenbanken has raised the limit off its debt issuance facility to euro7.5 billion ($6.51 billion) from euro5 billion. Nomura International has been added to the dealer panel alongside the arranger Deutsche Bank, BNP Paribas, Credit Suisse First Boston, JPMorgan and UBS Warburg. The facility, which was signed in December 2000, has £

* Republic of Austria Rating: Aaa/AAA/AAA

The panic that has gripped the credit markets since Enron’s fall reached fever pitch this week, as even the world’s largest company by market capitalisation, General Electric, was caught up in the cacophony of rumour and innuendo that on Monday prompted Tyco International to draw down emergency bank lines after it lost the confidence of the market.

The panic that has gripped the credit markets since Enron’s fall reached fever pitch this week, as even the world’s largest company by market capitalisation, General Electric, was caught up in the cacophony of rumour and innuendo that on Monday prompted Tyco International to draw down emergency bank lines after it lost the confidence of the market.

In an atmosphere of near panic, investors sought to reduce their exposure to credit this week and corporate spreads widened dramatically on any piece of negative news. DaimlerChrysler bonds widened by around 30bp after the company reduced its 2002 earnings target. The rest of the auto sector moved out in sympathy, with Ford bonds in particular encountering strong selling pressure. Ford's recent 6% 2005 bond widened to 264bp over mid-swaps, having been launched at 170bp over. Telecoms spreads had their worst week since early September. In Europe, the focus was on France Télécom and Deutsche Telekom, their bonds underperforming those of their European peers. Spreads on FT widened by as much as 80bp-100bp against swaps, and even the more successful operators, such as Vodafone, moved out by as much as 18bp against swaps. Only one corporate braved the euro market - GIE Suez Alliance, which raised Eu1bn of seven year money at 68bp over mid-swaps, which was at the tight end of the 67bp-72bp price guidance. The deal, led by Citigroup/SSSB, Deutsche and Morgan Stanley, reportedly amassed an order book of Eu1.7bn without a new issue premium - an impressive result given the wretched market. The deal maintained its launch spread in the aftermarket while other deals continued to widen, a testament to the safe haven flavour of utility credits. Next week, EnBW will test investor appetite with its circa Eu1.5bn seven to 10 year bond via Barclays and Deutsche. Meanwhile, Union Fenosa's debut benchmark offering, via Goldman Sachs, is still in the wings, and one banker described it as a tough transaction to execute. A Eu500m five year deal is expected with pricing in the high 50s over mid-swaps. With such a punchy funding level, the market is expecting the deal to be aimed at a domestic Spanish investor base. EU Sovereigns stole the limelight this week: Greece, Italy and Portugal launched a combined Eu10.5bn of syndicated government bonds, taking advantage of the demand for high quality paper to build oversubscribed books and price their benchmarks inside their curves. Spain will next week announce the leads for its planned 15 year Bono. KfW has announced plans to launch its Eu5bn 10 year benchmark bond at the end of February or beginning of March following investor presentations to discuss its 2002 funding programme. Elsewhere, the pipeline is remarkably thin for February and is concentrated around financial issuers. BCP Finance Bank Ltd, guaranteed by Banco Comercial Português SA, is to launch a Eu500m 2007 benchmark. The deal will be led by Caboto IntesaBci, SG and BCP Investimento. Merrill Lynch and UBS Warburg will begin the roadshow for Northern Rock's benchmark floater on Monday. The deal is expected to be in the three to five year range and for Eu1bn. Natexis Banques Populaires is said to be preparing a self-led, Eu500m five year floater at 16bp-17bp over Euribor. And CDC IXIS, rated Aaa/AAA, is planning a $1bn three year transaction to be launched the week after next via ABN Amro, CDC and Merrill Lynch. The deal is expected to be priced in line with the recent LBBW three year, currently trading at Libor minus 1bp. Despite the jittery background, Enterprise Inns and Thames Water issued successful sterling bonds, Enterprise with a £275m September 2031 secured bond and Thames with a £175m 30 year index-linked transaction. The sterling pipeline includes Deutsche Apotheker- und Aerztebank (DAPO), which has awarded a mandate to Barclays Capital to lead its forthcoming floater. Bankers expect a three year deal of around £100m. GKN is expected to tap its 2019 deal shortly via Barclays and UBS Warburg, and Barclays and Deutsche Bank have the mandate to lead manage a seven year sterling bond for BOC.