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For the first time this year the US high grade corporate bond market suffered indigestion this week, with about $18bn of corporate and agency issuance hitting the market or being added to the pipeline. Apart from Fannie Mae's $11.5bn two tranche issue, more than $9bn of high grade deals was announced. On top of that, France Télécom is preparing a $7bn-$8bn multi-tranche, multi-currency global for early March and AT&T Wireless is expected to raise $4bn-$5bn in the week ahead.

Despite localised difficulties in the high yield market this week - in particular a further loss of value on UK shipbuilder Cammell Laird's Eu125m 12% 2010 issue - bankers said conditions remain good for new issues and that borrowers such as Callahan Nordrhein-Westfalen (CNRW) are expected to tap the market over the coming weeks. Cammell Laird's issue fell to around 20% of face value after it emerged that a $500m contract with US cruise ship Luxus was almost certain to founder, following a statement from the chairman of Luxus that a possible UK government aid package guaranteeing loans to the company "offered impossible terms".

* AIG SunAmerica Institutional Funding II Rating: Aaa/AAA

Candover, the UK venture capital firm that is set to raise a new equity fund of up to Eu2.5bn, has officially acquired French frozen food retailer Picard Surgelés for Eu920m. Closing of the takeover took place earlier this week and it now falls to UBS Warburg, as sole lead arranger, to syndicate the Eu350m of senior leveraged debt facilities into the market. The senior debt comprises a Eu250m term loan (tranche 'A') at 225bp over Euribor, a Eu75m term loan (tranche 'B') at 275bp and a Eu25m revolving credit that carries a margin of 225bp. In addition to the senior debt, UBS Warburg and Intermediate Capital Group have jointly underwritten a Eu122m mezzanine tranche and Eu39.6m of PIK notes.

As a second crisis looms for Turkey only three months after the last, with a forced flotation of the currency, a spike in overnight rates and threats of ratings downgrades, activity on the primary international markets has been put on ice, as participants await clearer signals.

Arranger Standard Bank has closed the popular $45m three year term loan for HBOR, Croatia’s 100% government owned development and export bank. After an oversubscription the deal was increased from $35m.

Members of the Croatian government have been in London today roadshowing their intended Eu500m probable 10 year Eurobond, with support from lead managers Deutsche Bank and JP Morgan. The presentation demonstrated the Baa3/BBB- rated country’s healthy macroeconomic credentials, but also reeled out a long list of promised structural reforms, showing that the republic still has some way to go before it fulfills its self-proclaimed target of “full integration with the EU”.

Credit Suisse First Boston and Banca IMI pulled off the first ever Italian accelerated bookbuild at the end of last week with the Eu2.7bn sale of shares in energy company Eni. The lead managers attracted enough interest to cover the book 1.5 times and price the deal at a slim discount of 1.7%.

A huge mushroom shaped cloud hangs over 11, Madison Avenue, the beleaguered house of Credit Suisse First Boston. Has someone dropped a nasty bomb on our CSFB friends? The ambulance crews representing New York's finest tell us there may be many casualties on the executive floor. President George W Bush is said to be watching the situation with some concern. What is the cause for all the police sirens? Who gives a fig anyway about CSFB, a more secretive institution than the Vatican or Mediobanca and one which has led many a curious observer up the garden path and round the mulberry bush like a bewildered Taiwanese tourist.

Dollar swap spreads meandered within a tight range this week. At the close yesterday (Thursday), the 10 year mid-market was 95bp over the new 5% cash bond due February 2011, while five year swaps were at 83bp over the re-opened 5.75% Treasury due November 2005. These prices are little changed from a week ago. While swap spreads have not changed course substantially over the last week, the swap curve has steepened appreciably. At yesterday's close, the two year swap was bid at 5.21%, while the 10 year swap was bid at 6.09%. Only 24 hours previously this curve had been 77bp, so it steepened by almost 10bp in one day. At the beginning of the week, after the long weekend, the curve was 72bp, and it was around 69bp/70bp at the end of last week.

Deutsche Bank and RBS are underwriting and arranging the financing to back UK power company Innogy Holding’s acquisition of Yorkshire Power Group Limited.

Deutsche Bank and RBS are underwriting and arranging the financing to back UK power company Innogy Holding’s acquisition of Yorkshire Power Group Limited.