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The yen market has been creeping up to its usual activity and Friday saw 21 deals announced in the currency, raising just over $204 million for its issuers. One deal from Banque et Caisse d'Epargne de l'Etat Luxembourg took over 37% of this volume. The ¥10 billion ($76.29 million) trade goes out to June this year and has a fixed coupon of 4%. Credit Lyonnais Finance (Guernsey) announced three yen deals, for ¥103.5 million, ¥200 million and ¥200.22 million. They go out to March, April and May this year respectively. But Credit Lyonnais was also involved on the dealing side, leading a ¥500 million 15-year deal for BAWAG. The coupon is fixed at 3.2% for the first year, after which it becomes callable semi-annually, and CMS-linked, to the 20-year rate minus the two-year rate plus 65 basis points. Deutsche Pfandbriefbank made its 2002 debut on Friday. It was a ¥1 billion 30-year trade with Mizuho as bookrunner. The coupon is fixed at 5.5% for the first year, after which it becomes a power reverse dual currency (PRDC) note with a cap. Diamond Lease Company also made its first trade of the year in yen: a ¥3 billion three-month trade with a fixed coupon of 0.35%. And Goldman Sachs Group also went for a ¥3 billion note, which matures in January 2012. Nederlandse Waterschapsbank maintained a busy start to the year with its seventh yen note, a ¥1 billion 25-year deal led by Salmon Smith Barney. It has a fixed coupon of 4% for the first two years after which it becomes callable and a PRDC. And Vorarlberger Landes- und Hypothekenbank did a ¥1 billion 25-year trade via Nomura. It pays 4% for the first two years also, and then becomes an Australian dollar-yen PRDC.

Thursday was a busy day in the yen market, with 36 trades announced. The value of those trades was small however, and only World Bank and Canadian Wheat Board went for a size over ¥1.2 billion ($9.09 million). World Bank's ¥2 billion deal goes out to February 2032 and Canadian Wheat Board did a ¥1.8 billion 15-year trade via Mizuho. It also announced a ¥7.58 million 15-year note. AIFUL Corporation announced its fifth note in the Euro-MTN market: a ¥1 billion 5-year trade that has an initial fixed coupon of 2.21%. It issued twice in 1999 and once in both 2000 and 2001. BAWAG went for two trades at ¥1 billion and ¥600 million, both with terms of 20 years. And Oberosterreichische Landesbank, the only other Austrian issuer involved in the market yesterday, did two ¥1 billion 25-year trades and a ¥600 million 25-year trade, all via Mizuho. Rabobank Nederland went for two ¥1 billion 15-year trades, and Bank Nederlandse Gemeenten announced a ¥1 billion 15-year trade too. It has an initial fixed coupon of 2%. Earls did a ¥1 billion two-year deal, and SEALS did a ¥700 million two-year deal.

Supranational issuers were out in force with over $146 million raised off six trades. Nordic Investment Bank and European Investment Bank both went for PRDCs. Nordic Investment Bank's ¥5 billion ($37.88 million) 30-year note is non-call-three and callable annually thereafter. European Investment Bank's ¥1 billion note also goes out 30 years and is non-call-one. After the first year it has a trigger call and the coupon, which will be paid annually, is linked to the yen/US dollar rate. International Finance Corp issued two trades totalling ¥6 billion, going out to 2032 and 2027. And World Bank closed two notes for ¥5 billion and ¥2.3 billion (both go out 20 years). Two autos were also in yen. MMC International Finance issued a ¥2 billion two-month trade via Mizuho. And Toyota Motor Finance Netherlands did a ¥1.2 billion 10-year note that pays a final coupon of 1%. Mizuho also led trades for CDC IXIS Capital Markets, Banque et Caisse d'Epargne de l'Etat Luxembourg and Royal Bank of Scotland. Royal Bank of Scotland's ¥500 million 20-year note pays a fixed rate of interest at 2.4% for the first year. Thereafter interest is calculated according to 20-year CMS minus 6m ¥Libor and has calls semi-annually. And Nomura led trades for Landwirtschaftliche Rentenbank (a ¥2.5 billion 20-year reverse dual currency note linked to the yen/Aussie dollar rate) and for Nederlandse Waterschapsbank (a ¥1 billion 25-year callable note linked to the dollar/yen rate.)

Several high-rated issuers were placing paper with maturities going out to 2032 yesterday. African Development Bank did its third note of the year: a ¥500 million ($3.79 million) trade that matures in March 2032. It has an initial fixed coupon of 3.5%. Salomon Smith Barney led a ¥500 million 30-year trade for Kommunalbanken. Salomon also did trades for Eksportfinans (¥500 million, 20-years), World Bank (¥2.7 billion and ¥2 billion, both 29-years-and-eight-months), KfW International Finance (¥1 billion, 20-years) and Nikko Bank (Luxembourg) (¥300 million, one-month). Elsewhere Fujitsu Finance (UK) announced a ¥2 billion two-month trade that pays a fixed coupon of 0.08%. And also from Japan Tokyo-Mitsubishi International did a ¥700 million 15-year note that has an initial fixed coupon of 3%. Credit Lyonnais Finance (Guernsey) announced three deals, for ¥51.45 million, ¥50.40 million and ¥51 million, with respective terms of two months, three months and six months. Credit Lyonnais also kept up a run on the dealing side, leading a ¥1 billion 25-year trade for Pfandbriefstelle der Osterreichischen Landes- Hypothekenbank. It has an initial fixed coupon of 5.2% for the first two years, then is callable annually and becomes a power reverse dual currency trade.

HBOS, the UK's largest mortgage lender, is poised to make a dramatic entry into the securitisation market with a £2.5bn-£3bn deal to be lead managed by Citigroup/SSSB and JP Morgan. The move will give the booming European mortgage backed securities (MBS) market its second ultra-large issuer, alongside Abbey National. HBOS's master trust structure is likely to appear in the second quarter. EuroWeek has also learnt that Abbey's next MBS will be led in the next few months by Barclays Capital and JP Morgan. Recent Abbey deals have varied between £2.2bn and £2.7bn in size.

Collateralised debt obligations are due to kick off primary ABS issuance this year after a week dominated by intense activity in the secondary market. The first deal to break the new year hiatus will be a Eu513m arbitrage CDO for investment managers Prudential M&G, via Credit Suisse First Boston, expected to be priced today (Friday).

Deutsche Bank and Credit Suisse First Boston's $1.25 billion refinancing for PanAmSat is off to a solid start with the $600 million, seven year "B" term loan half full at press time. Last week Standard & Poor's assigned a BB rating to the senior secured credit facility and a B rating to the proposed $500 million senior unsecured note offering. A banker set out the spreads, with the "B" carrying LIBOR plus 3 1/4 %; the $400 million, six-year term loan "A" priced at LIBOR plus 2 3/4 %; and the six-year, $250 million revolver at LIBOR plus 2 3/4 %. There is a 3/4 % commitment fee on the revolver. Amortization of the term loans does not begin until 2004. There is a financial covenant for an initial five times debt to EBITDA ratio. Hughes Electronics owns 81% of PanAmSat, and this refinancing is connected to the plethora of transactions tied to the proposed merger of EchoStar with Hughes Electronic (LMW, 12/24).

Unproven turbines could restrict the amount of cash garnered by Citibank and Société Générale for the $1.7 billion non-recourse loan for project sponsor PG&E National Energy Group. The banks are looking for an extra $625 million during retail syndication after commitments of $1.075 billion came in before Christmas. One banker commented on the fat fees on offer, with $75 million receiving 1 1/4 %. Pricing is said to be LIBOR plus 1 3/4 %. "But the Siemen turbines are not 100% proven and this could be a problem," he added. Increasing exposure to the power industry is not assisting either, the banker said. Calls to Chris Beale, head of project finance for Citibank, were not returned.

Winston Hotels replaced its existing $140 million revolving credit line with a $125 million line because it did not need as much money and was looking to save on what it would pay on the unused portion of the loan. Other than its size, the new credit essentially mirrors the old: both are three-year revolvers collateralized by 28 hotel properties with similar covenants, explained Joseph Green, executive v.p. of acquisitions and finance.

Asset-backed finance veteran Andrew Yuder, has joined ING Barings as managing director of the firm's securitization group after leaving Credit Suisse First Boston last month. Yuder will be responsible for securitization origination with a focus on middle markets and less-commoditized asset classes. He reports to John Costa, head of securitization for the Americas at ING. Yuder said his focus will be on securitizing esoteric assets and niche markets including small businesses, equipment leases, and timeshares."I left because I thought there was more opportunity to do middle-market business here than at First Boston," said Yuder.

Metals USA tapped its relationship bank, Bank of America, to lead a $350 million debtor-in-possession financing facility last month after it filed voluntarily for Chapter 11 protection in November. The facility is set to mature in June 2003, allowing for two three-month extensions and it is priced at LIBOR plus 3/4 %. "It allows us to operate in a fairly normal way during the bankruptcy process," said Terry Freeman, v.p., chief accounting officer and treasurer, said of the DIP.

Regal Cinemas emerged from Chapter 11 with a Moody's Investors Service rating of B1 on its $370 million senior secured exit financing after the company eliminated two-thirds of its debt and strengthened its balance sheet. "I think Regal will hopefully do whatever it can to improve its operating performance in order to be able to withstand any short-run or long-term market disturbances," said Russell Solomon, analyst at Moody's.