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Crédit Lyonnais expects to close its long awaited Asian collateralised bond obligation in about two weeks. Emerging Asia CBO Ltd will parcel $80m of fixed rate dollar bonds issued by 30 borrowers in 11 Asian and emerging market countries.

UK mortgage lender RFC Mortgage Services Ltd, a subsidiary of GMAC's Residential Funding Corp, will launch its largest securitisation next month with an £825m deal via Barclays Capital. The transaction is also the issuer's first to include prime mortgages. Previous deals from RFC MSL have been backed entirely by non-conforming mortgages, but this time 50% of the pool will be prime loans. Such a mixture is rare in the market.

Goldman Sachs and JP Morgan this week completed a Eu633.1m securitisation of residential and commercial non-performing mortgages originated by Italy's Banca Nazionale del Lavoro (BNL). ARES Finance Srl refinances a portfolio of bad loans that JP Morgan bought from BNL last December (see EuroWeek 686).

Merrill Lynch has moved Ken Chang, co-head of Asia Pacific equity derivatives research in Hong Kong, to Tokyo as the new head of Japan and Asia Pacific equity derivatives strategy. He replaces Benjamin Bowler, managing director and head of U.S. equity derivatives research in New York. Bowler relocated to the New York office to replace Steve Kim, global head of equity derivatives research, who recently moved to Credit Suisse First Boston (DW, 6/8). Chang reports to Michael Maras, global head of equity derivatives research at Merrill in London. Maras said Todd Kennedy, co-head of Asia Pacific in Hong Kong, is now head of the department reporting into Chang. Chang said he is adding an additional researcher this month to the team of four in Tokyo, but declined further comment.

Market activity has barely gotten off the ground this week, as many players have taken the last weeks of summer for vacation. Those around say they've gone home early each day because it's so slow. They note that cable names are continuing to soften with Adelphia Communications flooding the secondary market with $3 billion in new issue. Charter Communications' bank debt traded down to 98 7/8, then offers popped back up to 99 1/8. Nextel Communications' bank debt hit the 93 ¼ then softened to 92 ¾ early this week on news that the company would buy back some of its bonds and swap it for equity. But market players initially were unaware that the activity pertained to Nextel International.

Axia Energy Europe expects to close its first stream flow derivative deal in Europe by the fall. Bill Gebhardt, director of weather derivatives in London, said preliminary talks started with hydroelectric power players a couple of months ago about the derivatives, which pay out if water flow is below a predetermined number of cubic meters per month. It has taken until now to get deals in place because risk managers needed to be educated about the products, he added.

ABN AMRO plans to hire fixed-income derivatives and credit products salespeople to boost its London and New York teams. Nigel Fox, global head of derivatives marketing in London, said the salespeople will be focused on selling to the hedge fund community. He added the beefing up was part of the bank's commitment to grow its derivatives capabilities, especially to the hedge fund community and that the bank wants to get the professionals on board as soon as possible. He declined further comment, so the current group size and hiring numbers could not be determined.

The Hong Kong branch of the Bank of China plans to beef-up its interest-rate desk in the coming months. Happy Chan, senior manager in Hong Kong, said the bank will attempt to build up interest-rate swap volumes and start offering caps and floors to customers by year-end. A combination of a merger of its 10 Hong Kong subsidiaries in October, which will give it access to a wider range of clients, and increasing client demand for interest-rate products has prompted the move.

New York-based Miller Tabak & Co. plans to beef up its derivatives sales staff to U.S. agencies over the next 12 months. The expansion is prompted by more demand from agencies, such as Fannie Mae, which has been flooding the market with note offerings over the last eight months. The firm has expanded its premises in New York and Kurt Soderberg, head of over-the-counter derivatives trading, said, "We have more space so we need more agencies salespeople." He declined comment on how may hires the firm would look to make, but said it likes sales specialists who can come in with their own list of clients. "We do mostly commission business so if someone can come with their own list its an added bonus."

BNP Paribas priced two synthetic collateralized debt obligations totaling EUR2.625 billion (USD2.4 billion) last week. Antoine Chausson, head of structuring credit derivatives in London, said it structured the transactions in the same week because they were not competing with each other for investors, even though both CDOs have five-year maturities and are referenced to investment grade Group of Seven corporates. Chausson said the difference is in the tranches of the two deals. CDO Master Investments is a EUR1.625 billion CDO made up of 68 credit default swaps and split into three tranches of credit-linked notes: a EUR49 million triple-A tranche; a EUR44 million double-A tranche; and, a EUR26 million A-minus tranche. The Rivera Finance 2 is a EUR1 billion CDO and is also split into three tranches but it has a EUR16 million triple-B plus tranche instead of the A-minus tranche. Chausson said investors in Northern Europe are likely to snap up the lower risk CDO Master Investments deal while Southern European investors will go for the higher coupon paid in the Rivera Finance 2 transaction.