A volatile swap market added some complications to an otherwise well received $1.37 billion commercial mortgage-backed securities inaugural transaction from Warburg Dillon Read last week, causing the bank and underwriters Lehman Brothers to carefully reconsider who they wanted to market the deal to: insurance companies or money managers?

The transaction - dubbed a "benchmark" deal for this year by several market players - is slated to be the largest conduit for 2000. The deal is set to price this Tuesday or Wednesday. After being taken out on a roadshow to more than 70 accounts last week, however, a choppy CMBS market and volatile swap spreads caused a distinct breakdown between Libor and the fixed-rate market.

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