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Fifteen Spanish savings banks are preparing to launch a Eu2.048bn bond that will securitise a pool of cédulas hipotecarias, the Spanish equivalent of mortgage Pfandbriefe. The transaction will be the first securitisation of cédulas hipotecarias (CHs), a covered bond product that dates back over 100 years but was revived in 1999 as a new, international asset class designed to mimic the funding benefits of Pfandbriefe.

National Australia Bank held roadshows in the US and Europe this week for its first securitisation of residential mortgages, expected to be priced towards the end of next week. Lead managers Deutsche Bank (books), JP Morgan and NAB will offer a single tranche of global bonds, estimated at $1.1bn and rated triple-A by all three agencies. With an average life of 2.6 years and seven year step-up and call, the bond will be priced over three month Libor.

Toronto Dominion Securities is preparing to launch the ¥5bn debut securitisation for Japanese consumer loan company KK Lettuce Finance later this month. The deal follows TD Securities' introduction of another new issuer from the sector, Alco Corp, with a ¥2bn transaction in late December.

DBS Bank, Singapore's largest local bank, is rapidly building its treasury and derivatives operations with over 10 new hires, many of whom are from Chase Manhattan Bank. The new professionals will join in the next two weeks, said an official at DBS in Singapore. The hires include derivatives professionals, the official said, noting that DBS is keen to catch up with more established derivatives providers and traders in Asia as quickly as possible. DBS has within the last year set up foreign exchange, interest-rate, equity and credit derivatives teams (DW, 11/29/99), in a bid to become a regional player. Regulatory changes by the Monetary Authority of Singapore last month allowing interbank trading of Singapore dollar/U.S. dollar options look set to considerably boost the market, making now a good time to hire, said Water Cheung, managing director and head of derivatives, treasury and markets in Singapore. He declined to comment on the professionals joining in the next several weeks. Interest-rate and foreign exchange products remain the bank's core derivatives business. DBS is also considering hiring derivatives marketers in Thailand, and has hired several professionals in Hong Kong over the past three months, he noted.

The post-holiday slumber is wearing off and market activity is starting to pick up. A $5 million piece of Voicestream's "A" tranche traded at 97 _, and Nextel's "B/C" tranche traded at par plus 1/4.

A task force for the derivatives implementation group of the Financial Accounting Standards Board is likely to offer relief to corporates concerned about the tax treatment for hedging floating interest-rate exposure on commercial paper programs under the FASB's statement 133. Statement 133 requires derivatives to be recognized on the balance sheet at fair value. A task force for the derivatives implementation group is leaning toward allowing hedge accounting treatment for hedges on the LIBOR component of commercial paper programs, according to several members of the derivatives implementation group. Issuers likely will be able to match swaps to the program as a whole, rather than being forced to match swaps to individual issues.

Prices for five-year protection on automobile names rose last week following an announcement by units of General Motors of planned multi-billion dollar bond issuances, which were expected to be priced after DW went to press Thursday. The announcement of the issuance on Tuesday caused five-year protection for General Motors Acceptance Corp. to trade early Wednesday at 98 basis points, up from 89 bps at the beginning of Tuesday, according to Marius Maldutis, v.p. and credit derivatives trader at Morgan Stanley Dean Witter in New York. GMAC is expected to issue USD2-3 billion in five-year notes, and GM is expected to issue USD1 billion in 10- year notes, according to a GM spokeswoman in New York. Ford Motor levels widened as well, with five-year protection with restructuring trading on Wednesday at 100 basis points, up from 90bps the day before. Ford is also expected to issue debt later this quarter.

BNP Paribas is planning this summer to set up a weather derivatives desk in New York. Denis Autier, head of global risk solutions in London, said the bank already trades weather contracts from Europe but wants to have a physical presence in the U.S. The bank set up its weather derivatives operation in May. It first traded weather from Europe because its insurance risk team is based there. Autier said the head of the department and headcount have not been finalized yet. The desk will also deal with other alternative risk transfer products, such as insurance-related products.

Credit Lyonnais has hired Tony Wong, a foreign exchange sales professional at BNP Paribas in Hong Kong, to the new position of v.p. interest-rate derivatives sales and marketing for Hong Kong. Wong starts today and reports to Frédéric Truchot, head of derivatives sales in Hong Kong, according to Frédéric Lainé, Asia regional manager, interest-rate derivatives products in Hong Kong. The hire expands the bank's Hong Kong interest-rate sales and marketing team to three, he noted. Credit Lyonnais has been planning to expand its Hong Kong interest-rate derivatives team for some time to take advantage of growth in Asia's interest-rate market, Lainé said. Further hires are possible by the second quarter or second half, provided the market continues to grow, he continued.

Credit Suisse First Boston is recommending that clients buy one-year dollar puts against a basket of currencies containing euro, Swiss franc, sterling, Australian, Canadian and New Zealand dollars. Kevin Chang, foreign exchange strategist in London, said it is recommending this trade because the bank expects the dollar to depreciate against the basket of currencies as the U.S. economy slows down. National Association of Purchasing Management manufacturing survey data released last week suggests the weakening is likely to continue, as the economy slows and interest rates fall. CSFB is pitching the strategy with a maturity of between six months and one year because it believes there is room for a short-term correction in the dollar's recent weakening against the euro. CSFB forecasts euro/dollar at above parity, dollar/Swiss franc at CHF1.56, cable at USD1.45, dollar/Aussie at USD0.60, dollar/Canada at CAD1.45 and dollar/New Zealand at USD0.48 in 12-months.