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Oesterreichische Kontrollbank took advantage of the persistent bid for top quality paper in the global dollar market this week with the launch of its largest ever transaction, a $1.5bn three year issue that was twice increased from $1bn. The Austrian government guaranteed borrower's deal, via JP Morgan and UBS Warburg, attracted a similar following to those of the recent Inter-American Development Bank and Kreditanstalt für Wiederaufbau globals, both of which were priced after September 11.

Twenty deals were closed in other currencies on Thursday. And issues in Hong Kong dollar were a particular favourite. Thirteen deals came to market in Hong Kong dollar but eight of these were closed by Societe Generale Acceptance. It issued eight HK$77.50 million ($9.94 million) notes that mature in November and December 2001. Development Bank of Singapore was also very busy yesterday. It closed four one-month notes. The largest note was a S$800 thousand ($450 thousand) note that will be issued on October 24 2001. Republic of Austria saw opportunities in Swiss franc. It issued a Swf300 million ($185.72 million) eight-year note that pays a single final coupon of 3%. The note will be issued on November 12 2001. Artesia Overseas went out a little shorter with its NKr50 million ($5.70 million) note that matures in 2003. The note, which pays interest annually, offers a final coupon of 4%. And Skandia Insurance went out three years with its Skr400 million ($37.86 million) note that pays interest annually and offers a final coupon of 5.5%.

Deals in other currencies have started to take off. Fifteen deals were closed on Friday: three in Swedish krona, four Hong Kong dollar deals, three in Singapore dollar, two sterling notes, and one issue in Polish zloty, Australian dollar and Norwegian krone. Rabo Australia went for a A$100 million four-year note that pays a final coupon of 5%. The note is rated triple-A by Moody's and Standard & Poor's and was issued at a price of 101.62%. The lead dealer off the note was Royal Bank of Canada Europe. Development Bank of Singapore was busy and closed three one-month trades in Singapore dollar. The largest trade was a S$1.66 million ($940, 000 thousand) note that will be issued on November 22 2001. Deutsche Hypothekenbank Frankfurt-Hamburg saw opportunities in Swedish krona and issued a Skr555 million ($52.03 million) note. The trade, which pays interest annually, offers a final coupon of 5.26% and will be issued on October 25 2001. Ericsson also plumped for Swedish krona. It issued a Skr370 million three-year note that pays a final coupon of 6.35%. The trade pays interest annually and will be issued on October 11 2001.

Hong Kong dollar was the only other currency investors felt comfortable with yesterday, as more uncertainty gripped the market. Just over $25 million was issued in the currency off five trades. Four of the trades were at the short end. Development Bank of Singapore, KBC Financial Products International and SGA issued one-month notes for HK$1 million ($128,230), HK$30 million and HK$77.50 million respectively. And Credit Lyonnais Finance (Guernsey) closed a HK$8 million trade that goes out six weeks. Commerzbank was the only issuer to venture past a six-week maturity with its HK$80 million two-year trade.

Polish gas monopoly PGNiG has adopted an unusual covenant package, including coupon step-ups, for its unguaranteed Eu500m five year Eurobond via ABN Amro. It is due to finish its one week European roadshow in Amsterdam today (Friday). The state owned issuer has been forced to respond to concerns not only about its potential privatisation - as with previous emerging market issuers - but also about a possible fall in credit rating to speculative grade.

The rapidly growing Polish investor base has made an important advance by participating for the first time in large numbers in a Eurozloty bond issue. GMAC issued a Z100m (Eu26m) two year bond via Commerzbank on Tuesday. "We were able to make secondary sales of zloty Eurobonds to Poland in the past," said Tomas Cerny, head of origination at Commerzbank Capital Markets in Prague. "But this issue was a real breakthrough in terms of primary demand for the bond."

Seventeen trades have been closed in US dollar, and over $1.05 billion was raised. No trades were issued with a term of less than one year and Lloyds TSB Bank was the only issuer in the one-year sector with a $8.40 million note. And Legal & General Finance went out to 18 months with a $58 million trade via UBS Warburg. The trade is floating rate linked to 3m $Libor +6bp and is non-callable. In the two-year sector Landesbank Sachsen closed a $20 million floating rate note linked to 3m $Libor -1.5bp and interest is paid quarterly. Barclays Capital was the bookrunner. Republic of Argentina issued two three-year notes: one for $227.65 million and the other for $95.40 million. Svensk Exportkredit closed a $70 million seven-year trade due to be settled on October 24. Tsubasa Europe is the bookrunner and the trade pays a fixed coupon of 4.5% semi-annually. And in the longer term Bayerische Landesbank closed a $5 million fixed rate that goes out to 2011. It is due to be settled on October 17 and is annually callable. Mizuho is the bookrunner. But this was not the longest-dated trade. Asset Repackaging Trust issued a $2 million that goes out to 2013.

Globals * Fannie Mae

Just seven trades, totalling $427.12 million were issued in US dollar and four came from HSBC. The bank concentrated its trading at the short end and the HSBC Investment Bank (Netherlands) issued two notes for $20 million, which both mature on December 7 this year. They are due to be settled on October 17. And HSBC Bank USA issued two six-month notes: one for $1.54 million and one for $80,000. Both notes are due to be settled tomorrow and will mature on April 12 2002. Guaranteed investment contract- (gic-) backed issuer John Hancock Global Funding issued a $320.50 million with a tenor of 23 months. And Achmea Hypotheekbank went out to three years with a $60 million trade, due to be settled on October 19. Beta Finance Corp was the only borrower to issue in the long-term maturity sector. Its $5 million note goes out to 2011 and is due on October 17.

Northern Rock closed two large notes, both due to be settled on October 17 and both going out one year. Lehman Brothers was the lead dealer off both trades. One was for $300 million and pays a floating rate of interest linked to 3m $Libor plus a margin. The other note, for $325 million, was linked to 1m $Libor. Royal Bank of Scotland issued three $10 million trades, two of which go out to 2011. One trade is due on October 19 and goes out to 2007. It is a range accrual note linked to 3m $Libor arrears during years two to six and will pay a fixed rate of 5.900%. During the first year the coupon is fixed at 5.000%. Lehman Brothers is the bookrunner. Royal Bank of Scotland also issued a $10 million 10-non-call-two trade that is linked to 6m $Libor +60bp until the call and pays a fixed rate of 7.250% annually thereafter. The note was self-led. And it closed a $10 million 10-non-call-two led by JPMorgan. Interest is linked to 3m $Libor +63 bp until the call and 7.250% annually thereafter.

Volumes crept back up again as UD dollar brought in $752 million on Friday, compared to the $2.67 billion that went through the market altogether, mostly in euro and yen. KfW International Finance closed a $20 million four-year trade via HSBC. The note is due on October 12 and pays a fixed rate of 4%. It is callable after one year and semi annually thereafter. K2 Corporation, the Cayman Islands-based financial corporate, issued a $30 million one-year trade. Instituto de Credito Oficial closed a $25 million 18-month trade that is due to be settled on October 11 and pays interest quarterly. Bank of Nova Scotia was active in the mid-term, with a $30 million three-year note. It pays a final coupon of 11.400%. And Hitachi Asia closed the longest-dated US dollar trade: a $500 million eight-year note that pays a final coupon of 5.050%.

The market reacted sensitively to the military action taken against Afghanistan on Sunday night. And public holidays in Japan and the US on Monday meant that overall just 47 trades were closed on Monday. US dollar saw just under a quarter of the action, with 10 deals closed. Hitachi International (Holland) came to the market with a $20 million six-month note, its first note in US dollar this year having previously issued only in yen. Other issuers in the mid-term sector were all bank names, such as Barclays Bank with a five-year $18.78 million trade that pays a final coupon of 5.800% and pays interest semi-annually. It also issued a one-year $30 million deal. Commonwealth Bank of Australia also closed a five-year $10 million note that pays interest quarterly and a final coupon of 6.635%. And BNP Paribas was in the five-year sector with two $5 million notes. Freddie Mac and Lehman Brothers SPV Anthracite Rated Investments closed the longest-dated trades. The former issued a $50 million note that pays a final coupon of 5.200% and goes out to 2007, while the SPV also issued a six-year trade for $20 million.