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Alan Lo, managing director and co-head of Asia Pacific (ex-Japan) equity derivatives at Deutsche Bank in Hong Kong, resigned last Monday. Lo, who was responsible for equity derivatives sales, structuring and marketing for Asia ex-Japan and Australia, declined all comment. Nick Fennell, managing director and co-head of equity derivatives (ex-Japan), who is responsible for the trading side, referred calls to the press office.

FundPartners is considering structuring the first guaranteed hedge fund in the Netherlands, which would likely use over-the-counter options for the underlying and the guarantee. Jurcell Virginia, head of alternative products in Laren, said the company is looking to launch the fund, which will aggregate a basket of low-volatility convertible arbitrage funds, to tap into the Dutch market's growing appetite for alternative investments. He declined to estimate how large the fund will be or discuss further details, given "at the moment we have no formal commitment to this, it's in the work-in-progress stage."

Credit-default protection on European heavyweight France Telecom widened about 10 basis points last week amid mounting concerns related to the incumbent's stakes outside its home turf that some investors fear could lead to higher debt burdens at the parent company. Five-year protection widened from 160-170bps at the start of the week to 180-190bps by the end of the week. At issue are its minority stakes in wireless providers MobilCom of Germany and NTL in the U.K. "France Telecom might have to guarantee MobilCom's debt and at the moment it really doesn't need any more debt," said one trader, adding, "NTL has had a huge build out [of its network] and there's a concern it could breach its covenants." He quipped, "they've spent a lot of money [sponsoring] the wrong football clubs as well," referring to the Aston Villa Football Club in England.

WestAM is planning to make its first investments in credit derivatives for its fixed income portfolio as part of a broader trend toward investing more of its EUR2.7 billion (USD2.4 billion) fixed-income portfolio in the credit markets. Nigel Jenkins, head of global fixed-income and currency in London, said 15-20% of those assets are in corporate bonds and predicted that figure will rise above 50% in the next few years as the proportion of government debt dwindles. "We will be managing more portfolios with credit benchmarks and there is a role for credit derivatives for efficient portfolio management," he said. However, he stressed the asset manager has not made any synthetic credit investments to date and said none are imminent.

The California Earthquake Authority is planning to issue a USD100-200 million catastrophe bond tied to earthquake risk. It will also be the first CAT bond it has issued in which it has not used a reinsurer. Market officials estimated this will save the authority USD5-6 million. A CAT bond analyst in New York said this is a natural progression for the authority as it has been issuing CAT bonds for some time and knows what to do. Tim Richison, cfo of the authority, referred calls to Stan Devereux, company spokesman. Devereux confirmed the plans. "We're looking to diversify our capacity to pay claims and we're exploring CAT bonds as a means of getting it done," he added, declining further comment.

Ward Ferry Management, a hedge fund in Hong Kong with over USD70 million in assets under management, is looking to increase its use of over-the-counter options by USD10-20 million (notional) in the next month as it sees strong investment opportunities in India. "We can't hold stock, we can only hold OTC options for that market," said Edgar Fok, analyst in Hong Kong, noting that as the fund does not have a securities license for India, it takes exposure via over-the-counter options. "We expect strong performance in this market," he said, adding that as the global technology sector rebounds, India, which is a major technology manufacturer, will benefit.

HSBC plans to begin issuing warrants in Hong Kong for the first time, as the warrant market re-launches on the Stock Exchange of Hong Kong this week. "This is a reasonably profitable area of business," said Franklin Heng, head of Asian derivatives in Hong Kong. Heng, who will spearhead the effort, noted that the bank will look to become a big player as it looks to leverage its strong local banking presence, for example it can market the products to its private banking clients. "We'll focus our existing capability for this," added Heng, noting that the bank's current equity derivatives operation is sufficient for handling the product.

J.P. Morgan is structuring a five-year, USD7.3 billion index-linked credit protection product thought to be the first of its kind. The product, which provides second loss protection against default by corporates and sovereigns, will be used by a fund manager as a proxy for credit protection on its fixed income portfolio, according to Oldrich Masek, managing director and European head of structured credit in London. The fund manager chose index-linked credit protection because it is cheaper and more flexible than buying individual protection on each name in its extensive portfolio. He declined to name the fund.

ICAP started crossing sterling forward-rate agreements Monday and plans to expand the service to euros today and dollar and yen in February. GBP6.8 billion (USD9.7 billion) went through the Web-based system, dubbed fra-CROSS, on its first day, according to Charles Sabel, marketing manager in the electronic broking division in London.

Crédit Agricole Indosuez is looking to hire a credit analyst to evaluate the firm's counterparty risk in cash and derivatives transactions with other financial institutions. The role, a new one, has been created as the bank decentralizes its counterparty credit analysis from Paris into satellite offices, said Nils Johnson, manager of the financial institutions department in London.

Lehman Brothers has transferred Satu Parikh, interest-rate options trader in New York, to Tokyo as its Asian head of interest-rate derivatives, in a position that was set up to allow the firm to expand its derivatives desk. Parikh reports to Koji Tsubouchi, managing director of fixed-income in Tokyo. Tsubouchi said Parikh joined three weeks ago. Parikh declined comment.

Credit Lyonnais has hired Tony Au, head of capital markets at Fortis Bank Hong Kong, as a regional fixed-income structurer in Hong Kong to kick start its credit structured products business. Up until now the firm only had credit-default swap traders, according to Frédéric Lainé, Asian head of fixed-income and derivatives in Hong Kong. Au declined comment.