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ABN AMRO, Citibank, Credit Suisse First Boston, Deutsche Bank and Société Générale have won the mandate to arrange and underwrite a $1.5bn eight year term loan for Lukoil, Russia's largest oil company. The loan, which will be secured by export receivables pledged to a master trust established by Lukoil, will be repayable over six years following a grace period of two years.

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BARCLAYS and Merrill Lynch have won the coveted mandate to arrange and underwrite a jumbo debt facility which will back Great Universal Stores' (GUS) bid for Argos. The mandate follows GUS's decision to make a hostile £1.67bn bid for the UK catalogue retailer. The two banks signed up to the deal on February 2, after a rapid award process that surprised many in the market.

A BUSY pipeline is beginning to build in the sterling high yield corporate bond sector following the launch of the largest deal in the nascent market to date. Last Friday, bookrunner Goldman Sachs launched a two tranche sterling/dollar financing for UK telecom and cable TV company Diamond Holdings.

INVESTORS starved of Polish sovereign risk devoured $600m and Ffr1.25bn of synthetic government bonds this week as France's export credit agency securitised Polish Paris Club debt. The Polish state incurred obligations to the Compagnie Française d'Assurance pour le Commerce Extérieur (Coface) when it defaulted on payments for exports from French companies in the early 1990s.

* Floating rate dollar investors this week eagerly greeted one of the first FASIT securitisations, as Nomura Asset Capital Corp launched $2.05bn of Euro/144A notes through Nomura and Morgan Stanley Dean Witter. Nomura Depositor Trust Series 1998 ST-1 sold $1.209bn of triple-A rated senior notes with a 2.9 year average life and four classes of bonds with 4.96 year average lives rated double-A, single-A, triple-B and triple-B minus.

SBC WARBURG Dillon Read has launched a £250.33m securitisation of shared appreciation mortgages, its second packaging of the asset class, but the first to attempt to tap into US demand. Unlike the first deal, launched in July 1997, this transaction contains a 144A provision under which, according to SBC Warburg analyst Pratik Shah, some 30% of the deal is likely to be sold. That extra pool of demand may be needed: the Bank of Scotland has already announced that it will issue up to a total of £1bn of similar bonds this year, with the underlying product accounting for around a third of the bank's new mortgage product this year.

The consistent pricing of derivative products involving the joint realizations of a collection of forward rates requires the specification of the covariance matrix between the various underlying rates.

Australia's domestic bond market is enjoying rapid growth. The build-up of investible funds at a time of a declining government borrowing requirement is creating a need for new forms of fixed income assets.