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German mutual funds manager Deka Investment Management has grown into a major investor in the credit markets over the past two years and with that, has come the need to select an appropriate set of indices against which to measure itself. In 1999, Deka went shopping for an index to do the job.

The race to be index provider of choice in the European credit market is up and running, with Lehman Brothers, Merrill Lynch and Salomon Smith Barney regarded as leading the field. But new entrants to credit market index provision are placing their hats in the ring - among them, JP Morgan.

Index providers deliver an invaluable service to investors, but what is in it for them? The profits generated by a bank's index group are difficult to quantify, but there are plenty of good reasons for being in index provider. Running an index is hard work, but there is ancillary business to be done.

From the perspective of how they are structured, credit indices are united by their differences. But it is the diversity of investor preferences that makes for such an array of contending product. Some investors want their credit index to be liquid, while for others, all-inclusive product is the key.

The days when average duration and sector weights comprised the totality of an investor's armoury when managing against an index are long gone. 'Slicing and dicing' and the ability to analyse an index's risk properties in minute detail are the qualities that investors expect from product today.

Index product has proliferated in the European high yield market over the past 12-18 months. Almost every investment bank wants a high yield index, it seems - not least for use as an origination tool. One provider stands out according to investors - Merrill Lynch - but others are fighting back.

The requirement to assess hedge effectiveness in the Financial Accounting Standards Board's new statement on derivatives accounting, Statement 133, Accounting for Derivative Instruments and Hedging Activities, is critical for qualifying for special hedge accounting.

The dual listing of Jitong Communications on Nasdaq and on the Hong Kong Growth Enterprise Market is in premarketing and bankers expect to launch the deal imminently. Joint lead managers Dresdner Kleinwort Benson and Lehman Brothers are selling 71,994,000 shares either as 'H' shares or as American Depository Receipts (ADRs).

China BP Amoco is in discussions to invest about $200m in China National Offshore Oil Corp (CNOOC) as a precursor to the planned IPO of CNOOC, set for February next year. The investment would follow a purchase by Royal Dutch Shell, of between $200m and $400m of CNOOC shares as part of the IPO.

Unconfirmed newspaper reports appeared in Australia this week indicating that Foster's Brewing Group may move its A$700m hotel assets off balance sheet. If the deal takes place, bankers in Sydney believe the transaction will be through a listed property trust structure, although they have not discounted the possibility of an asset backed securities transaction.

The planned $3.5bn NYSE listing and American Depository Receipt (ADR) issue for Chunghwa Telecom has been greeted with market scepticism. "We are amazed the Taiwan government wants to proceed with a deal of this size when the market has been so weak and when the whole investment community is winding down for the year end," said a syndicate head in Hong Kong. "The whole float exercise to date has been a failure and an offer of this size at this time would be a Herculean task." The Taiwan government is under intense pressure at home and also from mainland China. Many believe the government will not last many more months as the pressure builds to restore political stability. The government appears adamant that it wants to secure roughly $3.5bn this year, rather than wait until 2001.