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Turkey has kicked off its $3bn 2002 funding plans with a $600m 10 year bond via Goldman Sachs and Credit Suisse First Boston. The bond came as no surprise to the market, following soon after the 2012 issues from Brazil, Mexico and the Philippines.

Airtours is thought to be tapping the market soon for a £200m credit. The deal is likely to refinance a £250m three year deal arranged by Barclays Capital in April 2000. That deal paid a margin of 40bp over Libor with a commitment fee of 20bp and a utilisation fee of 5bp if over 50% drawn.

Turkey has kicked off its $3bn 2002 funding plans with a $600m 10 year bond via Goldman Sachs and Credit Suisse First Boston. The bond came as no surprise to the market, following soon after the 2012 issues from Brazil, Mexico and the Philippines.

The UK government warned holders of the £400m Railtrack convertible bond this week that it could stop paying interest on the debt after investors refused to join the debt standstill agreement. Convertible bondholders are protesting about their loss of equity value following the decision to place Railtrack into administration in October.

The 23 US dollar trades all came from A3-rated borrowers and over. Just one US dollar trade so far this year has come from a triple-B rated borrower. The biggest trade came from Rabobank Nederland. The $1.1 billion CMS-linked note was managed by Mizuho and will mature on January 30 2017. Rabobank Nederland also issued a $10.30 million three-year range accrual note. The bookrunner was JPMorgan. Other issuers in the currency were Bank of Scotland Treasury Services with a $250 million two-year note and Instituto de Credito Oficial, also with an amount of $250 million, which goes out to 2005. Electricite de France also closed a $250 million syndicated deal via Royal Bank of Canada Europe and Salomon Smith Barney.

Globals * KfW International Finance

All but one of the 17 US dollar trades were from the private bank sector. The lowest-rated issuer was Unibanco - Uniao de Bancos Brasileiros did three notes: a $9.21 million one-month note, a $1.1 million six-month trade and a $1 million six-month deal. Rabobank Nederland issued two notes for $10 million. One is a four-year note and pays a final coupon of 5.250%. And the other goes out five years and 10 months and pays a final coupon of 5%. The only private corporate was Sigma Finance Corp with a $16.80 million three-year trade.

US dollar made up about 20% of the market with $584 million traded off 12 deals. BNP Paribas did two six-month notes for Banque Generale du Luxembourg. The first was a $2 million inverse floating-rate trade with annual call options. It is due for settlement on January 29. And the second note was a $10 million trade with the same structure, due on February 14. Pfandbrief Bank International closed a $33 million trade via Dresdner Bank. It is due on January 22 and goes out to January 23 2003. The plain vanilla deal pays a fixed rate of 2.135%. Toyota Motor Credit Corp was in the market again with a $100 million four-year note that pays interest semi-annually and Maquarie Bank did a $100 million two-year FRN note via UBS Warburg.

* Bank of Scotland Treasury Services plc Guarantor: Bank of Scotland

Austria Mandated arrangers Bank Austria Creditanstalt (joint bookrunner), Citigroup/SSSB (joint bookrunner) and Dresdner Kleinwort Wasserstein (joint bookrunner, facility agent and documentation bank) have launched a Eu500m five year revolving credit for Austrian utility OMV.

KfW's $3bn five year global dollar bond, the German agency's first step in establishing a dollar programme on a par with its euro benchmark issuance, dominated the high grade market this week. Lead managers, Citigroup/SSB, Goldman Sachs and Merrill Lynch, achieved KfW's aim of expanding its investor base into the US, selling this highly successful bond at 5bp over agencies. Meanwhile, Fannie Mae will today launch a reopening of its $4bn January 2007 Benchmark Note for pricing on January 24. Ford's restructuring announcement last Friday and its subsequent one notch downgrade by Moody's caused auto spreads to widen dramatically this week and led to a general deterioration in spreads across most sectors. In this negative environment, however, GMAC is set to announce plans for jumbo issues in the dollar and euro markets.

Volkswagen Financial Services launched its largest ever bond this week, a Eu2bn dual tranche transaction, but suffered from its ambitious targets and an end to the credit rally of this year when it was forced to pay a wider spread than expected. The benchmark issue, split into three and 10 year tranches, had been initially expected to receive a warm reception, but came in a week dominated by poor results from the sector and Ford's downgrade by Moody's.