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Bear Stearns and CDC IXIS Capital Markets are co-agenting a synthetic collateralized debt obligation referenced to a USD1 billion pool of investment grade bonds. The structure, dubbed GIA Investment Grade CSDO 2001/2 Ltd., is relatively unusual in that the reference pool will be actively managed, according to an official familiar with the deal. To date this type of structure has been primarily used by banks looking to lay off risk, whereas the reference portfolio in this transaction will be created to take on risk, he added. Officials at Bear Stearns declined all comment, citing Securities and Exchange Commission rules preventing disclosure.

Barnaby, British Columbia-based TELUS Corp. recently entered a foreign exchange swap to convert a pair of multi-billion dollar U.S. bonds into a synthetic Canadian dollar liability. Robert Gardner, director of finance, said, "it's become a pure Canadian dollar liability. It's fully hedged." TELUS executed a six-year swap that matches the six-year USD1.3 billion 7.5% notes and a 10-year swap that matches its 2011 USD2 billion 8% notes.

Half of Bankgesellschaft Berlin's 10-strong London-based credit derivatives team has resigned over the last two months, reportedly because of uncertainty about the firm's ownership. The State of Berlin is expected to decide whether to sell its 81% stake by January, according to officials in Berlin. Frank Boenke, general manager in London, and Reinhard Fröhlich, a BGB spokesman in Berlin, did not return calls.

Credit Suisse First Boston last week reportedly bought EUR500 million (USD458 million, notional) of interest-rate floors with low strikes as a gamma bet on euro-zone rate cuts, according to London-based traders. Approximately EUR500 million of copycat trades were entered into by other firms. An interest-rate derivatives options trader at CSFB in London declined comment and press officers did not return calls. Traders said CSFB entered three and four-year floors with strikes at 2.5-3%. It is exceptional for firms to enter options with strikes as low as this and there was almost no volume in the trades before the Federal Reserve rate cut, according to a trader. The at-the-money strike on four-year euro options was 4% Thursday.

Credit Suisse First Boston has watered down its New York equity derivatives sales and structuring hiring proposals since the market downturn but still plans to hire several pros, according to a company official. He declined to specify the number of hires, but market officials said it is looking to add at least five. The officials said CSFB would also look to further build the team by shuffling employees to the equity derivatives group.

Deutsche Bank has hired Andy Pitts-Tucker, salesman at futures and options broker Cargill Investor Services, in a similar position on its weather derivatives desk in London. He starts later this month and will report to David Pearse, head of the weather derivatives business in London, who declined to comment.

Dresdner Kleinwort Wasserstein has hired Ulrick Neuhauss, director in credit derivatives sales at Bankgesellchaft Berlin in London, as a director for its London-based structured credit sales group. He started Monday and reports to Raffaele Ricci, head of structured credit sales, Europe. Ricci said Neuhauss will fill a newly created role, noting the bank is adding to the team because it "sees a lot of potential in structured credits." Neuhauss' hire brings the structured credit sales team up to a dozen staffers, Ricci said.

Peter Kappel has resigned as managing director and head of securitization for Europe-excluding Germany at Dresdner Kleinwort Wasserstein in London. Kappel was responsible for cash and derivative securitizations. Officials familiar with the move said he will join Credit Lyonnais in London, where he will be charged with setting up a securitization group. He resigned last Monday.

Equity derivatives professionals at bulge bracket firms in the U.S., Europe and Asia are likely to see a 20-50% drop in their annual bonuses this year as investment banks look to cover loses incurred by a plummeting stock market, according to market officials. Most U.S banks began their annual review process for bonuses last week, according to headhunters.

Clarke Harris, chairman and ceo of the European arm of Entergy-Koch Trading, left the energy trading house last week.

Sal Oppenheim Jr. & Cie. has structured reverse convertible bonds based on shares in two German corporates that guarantee investors a 12.5% coupon by trading equity options with investors. The firm buys a put from investors to beef-up the coupon and sells a put to provide the guarantee.

Banca Popolare di Sondrio has sold U.S. dollar calls/Japanese yen puts to a customer following the firm's prediction that the yen will weaken against the dollar in the coming months as Japan's economy continues to weaken. Carlo del Grosso, head of trading in Lugano, Italy, said the firm sold two dollar calls in the trade, each with a notional size of USD15 million, which mature in December and June, respectively. Both options are struck at JPY120. Del Grosso declined to name the customer.