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Washington Group's bank debt fell from par to distressed almost overnight last week after the company announced it was at risk of violating covenants on a deal it signed in July. A pro rata piece traded around 60, and by late last week levels were quoted in the 52-56 range. One dealer reported $60 million had traded in that range on Thursday with Deutsche Bank reportedly handling the trades. Once a par name, Washington's precipitous plunge stunned some traders. "People assumed it was a par credit, the deal got done, and then it was like, crash," a dealer said. "Now people are quoting it in the 60s." A Washington Group spokeswoman declined to comment on bank debt levels.

Deutsche Bank has reportedly agreed in principle to pay up on a disputed credit default swap in which it provided protection to UBS on a company that designs and manufactures floors and ceilings. An official close to the situation said UBS will dismiss a lawsuit it brought against Deutsche Bank for failure to pay in the swap after what it thought was the reference company filed for chapter 11 bankruptcy protection last year. Terms of the settlement could not be determined by press time, the official said, noting that neither party has yet signed on the dotted line. Spokespersons at Deutsche Bank and UBS declined to comment.

UBS Warburg priced a 17.5m global depository receipt (GDR) offering for Sunplus Technology yesterday (Thursday) evening. The GDRs were priced at $9.57, a discount of 8.3% to yesterday's closing price of the ordinary shares in Taipei. The issue is the first depositary receipt issue from Taiwan for around six months and could encourage a spate of issuance. The deal raised $167.5m and will total $191.4m if the 2.5m GDR shoe is exercised. UBS Warburg launched the deal on Monday and had the book four times covered by the close of

Malaysian state owned power company Tenaga Nasional Berhad has stepped up its plans to buy back two outstanding bond issues worth $900m and offer a new 10 year international deal to replace them. Following a slight delay last week, Malaysia's largest company by market capitalisation filed a cash tender offer for two outstanding bond issues and a new global bond issue with the US Securities and Exchange Commission on Monday. A roadshow for the new bond issue begins next week.

ANZ Bank launched its second residential mortgage securitisation this week, with a A$500m deal that is set to price on Wednesday next week. The domestic issue will be followed later this year by ANZ's debut in the cross-border MBS market, with a global dollar issue mandated to Salomon Smith Barney.

The Austereo IPO has become a cautionary tale for bankers, issuers and investors. The issue struggled during marketing, and last Friday the bookbuild price range was, as anticipated, revised downwards to A$1.80-A$2 from A$2-A$2.40. The lead banks then priced the issue last Sunday in the bottom half of the new price range at A$1.85 but even that was not enough to prevent the shares slumping to A$1.66 when trading began on Monday.

Société Générale will use its multi-purpose securitisation vehicle ACE Funding Ltd next week to repackage part of a dollar bond issued by Ford Motor Credit Co of the US into Australian dollars. The deal exploits a window of opportunity in the Australian domestic market, where credit spreads are lower than in the global dollar market.

Société Générale this week priced a A$47.71m securitisation to finance the sale of 11 car dealerships by Mitsubishi Motors Australia Ltd (MMAL). The deal was arranged by Lend Lease Capital Advisory, a division of property and financial services group Lend Lease.

Acting once again as a trailblazer in the Singapore subordinated debt market, the Development Bank of Singapore Group (DBS) is poised to launch the city state's first hybrid tier one capital securities issue.

Australia Treasury Corp of Victoria on Tuesday sold A$1bn of its new November 2004 bonds, attracting strong market demand.

Australia Motorola, the US cellular phone firm, has sold its 13% stake in Australia's ERG for A$153m. Credit Suisse First Boston placed out 82.6m shares at A$1.85 each, a 1.5% discount to the previous market close.

The Government Housing Loan Corp (GHLC), Japan's largest residential mortgage lender, inaugurated its long awaited securitisation programme this week. Credit Suisse First Boston, which arranged the ¥50bn deal, was joined as lead manager by Goldman Sachs and Sanwa Securities. GHLC plans to sell ¥200bn of MBS this year, but it could eventually issue on a much larger scale.