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Contrary to widespread expectations and hopes, the US Financial Accounting Standards Board (FASB) on Wednesday declined to exempt old inter-company swaps from the impact of its new accountancy rules. This leaves users of swaps across the US facing the prospect of finding fresh offsets for hundreds of transactions. The controversial new measures, designated FAS 133, are designed to make derivative positions and their impact upon the balance sheet much clearer to shareholders than is currently the case. Unless the derivative on the books can be shown to be a perfect hedge, it must be marked to market at fair value with the result recorded on the earnings statement. Firms do not like this as it exposes their balance sheet to damaging volatilities.

Landesbank Schleswig-Holstein (LB Kiel) this week launched the first public, term securitisation by a German Landesbank, with a Eu1.007bn synthetic residential mortgage deal lead managed by WestLB. The transaction confirms the trend that Germany's banks, though slow to begin securitising, have now adopted the technique with enthusiasm, and are producing some of the asset backed market's most innovative structures.

* Leasingroma SpA, one of Italy's largest equipment leasing companies, launched its first securitisation this week, parcelling leases on heavy equipment to construction company Impregilo SpA. Leasingroma sold the equipment to special purpose vehicle Eurofinance 2000, which financed the acquisition by issuing Eu39.8m of unrated ABS. The SPV then leased the plant to Impregilo - lease payments will back the bond.

The Basel Committee on Banking Supervision has produced two further consultative papers on individual aspects of the new capital adequacy framework.

Global derivatives markets are facing change on an unprecedented scale following the introduction of business-to-business (B2B) derivative exchanges.

Australia * Telstra's announcement of a $3bn investment to form a joint venture with Pacific Century CyberWorks (PCCW) led to an immediate placing of its AA+ long term corporate rating on Standard & Poor's (S&P) CreditWatch with negative implications. S&P believes Telstra's financial profile will weaken due to the 100% debt-funded investment.

THE SECOND biggest share placement in Japan's history was completed this week as bookrunner Nikko Salomon Smith Barney reported that the jumbo issue for Oracle was more than two times subscribed. There was relief in Tokyo that the $7.5bn share placement was completed despite the sell-off on Nasdaq and the adverse sentiment towards new economy stocks such as Softbank and Hikari Tsushin.

THE PORT of Singapore Authority (PSA) has been conducting a beauty contest this week for its debut international bond financing. The contest comes as Singapore Power readies its inaugural triple-A rated $300m five year bond for launch next week.

TO THE relief but little surprise of Asian and emerging market bankers, the Republic of the Philippines decided - following a three day roadshow this week - not to forge ahead with its second euro denominated deal under the current market conditions. The deal, lead managed by ABN Amro, Credit Suisse First Boston and JP Morgan, was a planned Eu700m-Eu1bn transaction for seven or 10 years.

THE technology sector sell-off is not deterring investors from Asian semiconductor companies. Goldman Sachs bought a $207m block of Taiwan Semiconductor Manufacturing Company (TSMC) shares on Wednesday. Salomon Smith Barney is on a roadshow to sell 213m Chartered Semiconductor Manufacturing shares in a follow-on global offering likely to raise more than $1.6bn. TSMC is also preparing to raise more than $1bn in the coming weeks and Taiwan's United Microelectronics Corp (UMC) has said it wants to raise almost $2bn.

Australia * JB Were & Son and Warburg Dillon Read are joint lead managers for the planned 46.5m share spin-off IPO of the PaperlinX paper business from listed Australian company Amcor, which intends to become a specialist packaging stock with focus on offshore acquisitions.

LEHMAN Brothers closed the £130m equity fundraising for UK based business-to-business e-commerce software company Infobank twice covered amid tricky market conditions for internet related stocks. "Technology stocks have been in a downward spiral ever since launch," said a banker. "The sector and comparables have performed horribly."