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JP Morgan's programme origination department has suffered another blow. It has been dropped as arranger from Telenor's Euro-MTN programme. Only 2% of the issuers listed in MTNWare have ever dropped their arranger, according to the database. And this is the fifth time that JP Morgan has suffered this fate since January 1999. This move compounds a tough period for JP Morgan's origination team. After being dropped as dealer from eight programmes last year, it has been axed from a further five this year including Pacific Life Funding's facility and the prestigious SNS Bank's euro10 billion ($9.15 billion) programme. However, the US house's trading desk continues to be strong in most areas. It was voted most active dealer and best at reverse enquiry in MTNWeek's issuer survey in May. Deutsche Bank has been appointed in JP Morgan's place as arranger off Telenor's programme. And this is not the first time that Deutsche Bank has managed to wrestle an arrangership mandate off JP Morgan. It was appointed arranger off 3CIF's programme instead of JP Morgan in January 1999. And it replaced the US house as arranger off Imperial Tobacco's euro2 billion shelf earlier this year. Telenor refused to give a reason for its decision but the Norwegian issuer has taken the opportunity to double the size of the programme limit from $2 billion to $4 billion. Telenor has $1.97 billion outstanding off 25 issues, with the most recent trade being a ¥5 billion ($46.02 million) one-year deal paying Libor flat, which it issued in June. Though there was no one available from JP Morgan's transaction execution department to comment, a member of the bank's MTN trading desk said that losing the arrangership was not a matter of serious concern.

MORGAN STANLEY Dean Witter has followed its successful Highbury Finance sale and leaseback transaction for supermarket chain J Sainsbury plc with Dragon Finance BV, another special purpose securitisation vehicle for the UK retailer. "The difference to Highbury is the bond structure," said David Merchant, associate in securitisation at Morgan Stanley. "The underlying structure of the securitisation is much the same.

KLM, the Dutch airline company, has doubled the ceiling off its Euro-CP facility to euro500 million ($449.89 million). This is because the issuer wants more flexibility. Mark Biermans, treasurer at KLM, says: "Many banks are withdrawing from the short-term market, so we are increasing our direct access to investors." The issuer has no plans to sign an MTN programme, despite market rumours that they will sign. Biermans explains: "We have enough flexibility through our long-term financial leases and bank loans, so we are not planning an MTN."

Brazil

While the MTN market puts its feet up, content in the knowledge that Barclays and Chase have filled their positions, the CP market seems to have lost its head. We have all waited quite some time for Merrill Lynch to follow Morgan Stanley into the elite club of Euro-CP houses. And we will all have to wait a little longer, after it managed to hire someone for precisely one weekend. David Hayes, one of Citibank's leading CP traders, decided that he would grace Merrill's wannabe desk with his presence. But after the weekend he decided, on second thoughts, life at Citibank wasn't quite so bad after all and he returned to Victoria Plaza. However Susannah Savill, who was with Citibank's sales for 11 years, has gone to Barclays to join fellow ex-Citibanker Sally Vernon-Evans. And Andy Jones, who jumped ship from Barclays taking the entire desk with him to CSFB, is back at Barclays. A year running CSFB's CP desk was more than enough, we hear, and he has escaped into FRNs. He will be sitting next to one of the market's true stars: Rob Ford, who runs a rock band with the side-splittingly funny name, Light Alloy.

The wait is over. Yes, Barclays has found someone to run its MTN desk. After interviewing almost everyone in the market, it has managed to track down someone who was prepared to accept its infamously mean wages. And it has had to look far and wide. The new man hails from Lebanon. The bank has continued its policy of hiring traders with unpronounceable names and plumped for Nabil Aboulzelof who was last seen at ABN Amro in structured MTNs. He joins Apostolos Saflekos, who has been running the desk single-handedly since April. The two 28-year olds are joined by just-out-of-nappies Wayne Hiley, an internal transfer from UK corporates. And it seems Cliff Dammers remains young at heart by watching late-night TV. IPMA's head man has been waxing lyrical about how the market's leaders just seem to get younger and more glamorous by the day. It would appear one dealer in particular catches his eye. He was overheard comparing her to Ling from the cult TV show Ally McBeal. Leak will spare Cliff's blushes by concealing the dealer's identity but an Ally McBeal video will go to the first MTNer to guess who she is. Answers by email, please.

MOODY'S has acknowledged the rapid growth of structured finance outside the US by appointing a managing director to oversee the business in Europe and Asia. Group managing director Daniel Curry will relocate to London from New York to manage the structured finance business in Europe and Asia.

Kuwait

Hungary Hungary will decide in September whether to tap the international bond markets. Bankers stressed that it did not need the money, but favourable market conditions for its credit might prove too tempting for the sovereign to resist.

* Security and home networks specialist Electronics Line, which originally planned to list on France's Nouveau Marché, will instead list on the Neuer Markt next week with a Eu38m-Eu45m IPO. The Israeli company, which is listed on the stock exchange in Tel Aviv, had planned to list on the Nouveau Marché in Paris, but was forced to pull its IPO in April due to poor market conditions. When the management decided to try to list again, they chose to go to the Neuer Markt in Germany. "They think the Neuer Markt is more suitable than the Nouveau Marché in Paris," said a banker close to the deal.

* Deutsche Bank has created a new structured products group within the global credit derivatives business. The group consists of the existing repackaging and portfolio swaps desks. The structured products group's mandate includes all complex synthetic products. Stephen Stonberg will head the new unit and report to Rajeev Misra and Boris Gelfand, co-heads of global credit derivatives.

Market report: Compiled by Glenn Blackley