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The Kingdom of Thailand heralded its return to the international bond markets after a four year absence, pricing a ¥35bn three tranche Samurai bond issue this week in the face of taxing market conditions. The kingdom's comeback has fuelled hopes that other borrowers, not only Asian but also international, will return to the Samurai market en masse. Early signs are encouraging, with Volkswagen (VW) and Household Finance set to launch deals early in the new year, albeit delayed from earlier this year.

Unilever's out of court victory over Merrill Lynch Investment Managers (MLIM) is raising wider concerns among pension fund trustees, according to research commissioned by SEI Investments. The landmark settlement between MLIM and Unilever Superannuation Fund is causing trustees to reassess the risk that their fund managers are running and the information flows about the performance of their clients' money.

Over $1.1 billion was traded in US dollar. HSBC was dealer for almost $300 million of this total as it did a large floating rate deal for one fund manager involving no less than 12 issuers. The bank managed trades worth $13.38 million each for seven borrowers: Northern Rock, Wurttemburgische Hypothekenbank, Irish Life Permanent, Britannia Building Society, Yorkshire Building Society, Prudential Banking and Landwirtschaftliche Rentenbank. And Dexia Credit Local, Abbey National, Hamburgische Landesbank and Depfa Bank Europe also did trades for $27.168 million via HSBC, while European Investment Bank did a $95.088 million note via the dealer. All the notes will settle on December 14 this year and will mature on December 16 2004. They are straight floating rate notes, which pay a quarterly coupon of 3m $Libor plus a margin that varies for each issuer and all were sold to one fund manager. Toyota Motor Credit Corp was in the market too with a $218 million five-year deal that pays interest monthly. And Telecom Corp of New Zealand (TCNZ) issued a $250 million 10-year deal that pays a final coupon of 6.750%. Other borrowers were either bank issuers or public agency borrowers such as Freddie Mac.

US dollar saw 17 trades that raised almost $400 million-worth of debt. Two German banks were in the five- and 10-year sectors: Landwirtschaftliche Rentenbank did a $10 million 10-year trade via Daiwa. The note pays a floating rate for the first two years of 6m $Libor +60bp and it then pays a fixed coupon of 7.750%. There is one call option on December 19 2003. Joining Rentenbank in the 10-year maturity bracket was UBS (Jersey), also with a $10 million trade maturing on December 14 2011. And Landesbank Rheinland-Pfalz issued a $5 million five-year trade that pays a fixed-rate coupon of 5.165% semi-annually. There are no call options on the note and it was done via Deutsche Bank. Other issuers in the five-year sector were Sigma Finance Corp, with a $15 million trade, and SGA with trades for $20 million and $10 million. Bank Austria was also in the market with a $250 million non-syndicated note via Royal Bank of Canada. The six-year trade pays a fixed coupon of 5.5% annually and there are no calls. And Abbey National Treasury Services did a $5 million three-year trade. It pays interest semi-annually and the final coupon pays 3.600%.

Sixteen trades were done in US dollar, but volumes were low as just $258.02 million was issued. Toyota Motor Corp did the largest trade - for $30 million. The note pays an annual coupon of 6.020% and goes out to December 27 2011. The only other issuer going for lengthy maturity was Bank Nederlandse Gemeenten. Its 10-year euro10 million note was non-call one and was led by Mizuho. Marks and Spencer Finance did a four-year $15 million MTN that pays interest quarterly. Fellow UK issuer, Abbey National Treasury Services closed a two-year $10 million trade. And Landwirtschaftliche Rentenbank closed a three-year $13.58 million note via HSBC. The note has a coupon of 3m $Libor-13bp. HSBC Investment Bank (Netherlands) was the busiest issuer, closing four $20 million trades. All four notes mature on February 7 next year.

Deutsche Bank and Goldman Sachs caught the market by surprise yesterday (Thursday) when it launched £1bn worth of BSkyB equity certificates for media group Vivendi Universal. The deal, which will be priced today, will unwind part of a complex swap agreement that Deutsche Bank and Vivendi put in place at the end of September.

* Deutsche Bank Finance NV Guarantor: Deutsche Bank AG

No one in their right minds would query that Barclays Capital has been one of the success stories of the year. So complete have been its achievements that CEO Robert Diamond is now known as Bob the Empire Builder, and is the toast of the parent Barclays Bank. Even the retail moguls at Barclays, who know 100 ways to skin the ordinary man in the street, have been singing his praises. Bob the Empire Builder has certainly had his bricks in line throughout most of 2001. Who today remembers 1998 when BC had its trousers removed in Moscow's Red Square and was made to eat squillions of dollars of worthless Russian bonds? Poor Noreen Harrington (of course you remember Noreen, whose star once also shone brightly at Goldman Sachs) was made to fall on her sword - or was it an upturned mascara brush?

Twenty-nine deals were closed in yen and the financials were leading the way. World Bank closed five 30-year notes. The smallest note was a ¥1.1 billion ($8.93 million) trade that pays a coupon of 4.5%. The note pays interest annually and will be issued on December 19 2001. The largest note from the issuer was a ¥1.5 billion trade that offers a coupon of 4% and pays interest semi-annually. SEK also found opportunities in the 30-year sector. It issued two notes: the smallest was a ¥300 million offer that pays a coupon of 6.2% and the largest was a ¥1 billion MTN. NIB Capital Bank issued the largest yen trade of the day: a ¥25 billion note that goes out to December 17 2003. The smallest yen trade was a ¥102.96 MTN that came from First Chicago Tokio Marine Financial Products (First Chicago), an SPV arranged by Morgan Stanley. First Chicago also issued a ¥300 million MTN that goes out to April 2002. Toyota Motor Finance was the only issuer from the auto sector active on Friday. It went out two years with its ¥2 billion MTN that pays interest monthly and offers a coupon of 0.045%.

France Foncière Euris, which owns 70.5% of Rallye, the operational holding company of French retail group Casino, has completed a Eu295m loan through mandated arrangers BNP Paribas (joint bookrunner) and SG (joint bookrunner).

UK issuers were the most active in the yen markets. But this was largely down to three trades from Barclays Bank. It closed a ¥200 million ($1.62 million) MTN that matures in January 2002, a ¥100 million 15-month note that pays a final coupon of 3% and a ¥50 million offer that pays a single final coupon of 11.5% and goes out to March 2002. Abbey National Treasury Services was the other active UK issuer. It closed a ¥1billion 15-year note, which offers interest semi-annually, and pays a coupon of 2%. Mizuho led the note. Japanese issuers closed the largest volumes. Mitsubishi Motors went out 23 years with its ¥2.3 billion trade, which pays a coupon of 1%. Sumitomo Bank International Finance also saw opportunities at the long-end and issued a 20-year ¥1 billion MTN that pays a coupon of 2%. KfW saw opportunities in the 30-year sector and closed a ¥1 billion MTN that pays a coupon of 3.1%. The note will be issued on December 20 2001. CDC IXIS also issued a 30-year note: a ¥300 million trade that pays a coupon of 3% and offers interest semi-annually. The trade will also hit the market on December 20 2001.

Commerbank claimed this week that traditional buy and hold strategies are no longer attractive for equity investors, and that 2002 will see the rebirth of sector rotation strategies. "All you could have done over the past five years is to buy equities and just hold them, on the basis that they were re-rated by falling bond yields," said Michael O'Sullivan, an analyst at Commerzbank, in the bank's weekly strategy report. "However, the trend of the bonds markets acting as a positive driving force for equity valuations has now largely gone."