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GlaxoSmithKline (GSK) will next week launch the largest ever corporate bond in the sterling market, a £750m-£1bn transaction of 30 years or longer, via Credit Suisse First Boston and Schroder Salomon Smith Barney (SSSB).

* Dexia Municipal Agency Rating: Aaa/AAA/AAA

Tate & Lyle has increased and redominated its note programme to euro1 billion ($888.90 million) from $500 million. There are also changes to the dealer panel. JPMorgan, Merrill Lynch and UBS Warburg have been dropped as dealers, while Commerzbank, Daiwa SMBC Europe, Schroder Salomon Smith Barney and SG Investment Banking have been added to the panel.

Telecom Italia will today (Friday) take advantage of the improvement in sentiment towards the telecoms sector by launching a Eu1bn plus floater it announced this week, which bankers expect to be increased after attracting strong demand. The FRN, due June 2005 and callable after two years, is likely to be priced at between 100bp and 102bp over mid-swaps by bookrunners IntesaBci, JP Morgan, UniCredit Banca Mobiliare and Schroder Salomon Smith Barney (SSSB).

The US Treasury market suffered a major correction this week, pulling global markets along with it. After the release of surprisingly strong NAPM data there was a fierce sell-off. At the same time, stocks enjoyed a frenzied rally. Ten year swap rates climbed 35bp in less than two days, and swap spreads widened in line with the higher yields.

Turkey has capitalised on the continued improvement in the post-Argentina market by tapping its Eu500m 2005 bond for a further Eu300m. The tap was led by Deutsche Bank and Commerzbank, the same pair that launched the original deal in October, ending an eight month hiatus. "The first time round, distribution was driven by Turkish demand," said a banker at one of the leads. "This time it was driven by German demand. This was thanks to two redemptions of Turkish Deutschmark bonds, and the reweighting of the EMBI index."

UK pension funds are set to undergo their biggest change in years - and the transformation could mean higher volumes in the Euro-MTN market. Changes in UK accountancy rules are luring pension funds away from equities into the corporate bond market and, after Boots recently decided to move its entire pension fund into bonds, market dealers are rubbing their hands in anticipation. "The change will drive business in the MTN market," says Gavin Eddy, head of Euro-MTNs at UBS Warburg. "The type of paper that pension funds require would suit utility issuers, which issue at the longer end and ultimately we may see more issuers setting up MTN programmes to meet this demand." The new regulation, which will make the cost of providing pensions more transparent within company accounts, forces funds to match assets with liabilities using a notional double-A rated corporate bond as the benchmark for asset valuation. As a consequence funds that do not have a substantial amount of corporate bonds in their portfolios may experience fluctuations in both their balance sheets and profit and loss accounts. This may pressure funds to increase their holdings of corporate bonds at the expense of other assets. The introduction of the rule, FRS 17, was approved a year ago but was brought to the fore last month when Boots announced that it had moved its entire £