After 12 years of service, Ed Bankole has left his position as a team managing director at Moody's Investors Service to pursue other interests, the company announced internally last week. While there is no official word concerning where Bankole is headed, he is expected to resurface at the end of the summer with a Moody's issuer client. Bankole was named managing director in 1998.
MBS pass-through traders Todd White and Neil Leonard were recently hired as managing directors to start an MBS trading desk at HSBC Securities. In their new roles, they report to Joseph Petri, senior executive vice president and head of global markets. The pair had a similar function at Lehman Brothers, where they traded Fannie Mae and Freddie Mac securities. White had been at Lehman for 18 years, while Leonard was at Lehman for 16 years.
Merrill Lynch is looking to hire a vice president to director-level analyst to work in its research strategy group, working closely with structured finance research head Dan Castro. The newly created position would focus primarily (66% to 75%) on cashflow analysis, with the remainder spent on synthetics.
Banc of America Securities has hired Peter Nguyen to lead a specialist sales effort focused on coverage of hedge funds, banks and other frequent users of credit derivative products. He reports to Charles McLendon, global head of the firm's investment-grade and credit derivatives business. Nguyen joins from Credit Suisse First Boston, where he was a director in credit derivatives with coverage responsibility for hedge funds and banks.
HSBC has announced that it will be cutting approximately 3,500 jobs and recruiting 1,000 branch staff over the next 24 months. Many of the job cuts will take place at the bank's head office. HSBC has made an extensive hiring effort to its securitization team earlier in the year.
Lewtan Technologies, provider of ABSnet, announced last week the availability of projecting cashflows for European ABS and MBS deals. With the addition of European deal models to ABSNet, Lewtan becomes the first provider of interactive cashflows and analytics for European deals which are continuously and automatically updated with performance data. In related news, Lewtan has seemingly lost its Reuters real-time news feed as of June 1.
Bradford and Bingley last week released further details of an upcoming master trust, expected to launch by September this year. The trust is expected to be backed by an initial GBP10 billion to GBP12 billion of collateral and will issue between GBP2 billion to GBP4 billion yearly. The trust will be 144A eligible.
The Murrayhill Company announced a new enhanced cashflow oversight service last week, launched in partnership with EmphaSys Technologies Inc. The new product provides oversight from pre-closing to last payout, and clients can reconcile the cashflow waterfall for each security monthly, among other services.
The Bond Market Association recently responded to the Bank of England's consultation paper entitled "Reform of the Bank of England's Operations in Sterling Money Markets" with a number of suggestions aimed at helping the bank achieve proposed improvements to ensure greater stability of sterling short-term interest rates. The BMA urged that any new framework continue to encourage active participation by the largest liquidity providers and create incentives for banks to actively speculate in and make two-sided markets in short-term rates.
Fixed-rate MBS supply has been at roughly $2 billion a day (based on originator selling), said JPMorgan Securities, suggesting a gross monthly supply of conventional MBS (fixed and ARM) of about $48 billion per month for August. Analysts said that roughly 70% of mortgage applications are now for purchases, which implies about $33 billion in turnover for August in conventionals.
Talk at the Global ABS conference in Barcelona this year focused on further development of the European markets. One analyst said there has been further talk of launching a tradable substitute for iboxx. "The idea is to export the technology to a portfolio of prime RMBS as a reference pool. This would be the perfect addition for portfolio management," said one industry source.
Four EU states have stepped up opposition to the proposed implementation of IAS 39 last week on the grounds that fair value accounting of derivatives used to hedge portfolio risks will lead to increased balance sheet volatility. The France-, Spain-, Italy- and Belgium-led opposition adds another kink ahead of the intended implementation deadline of January 2005.
Housing starts in May dropped slightly, by 0.7%. However, the figures are down 100,000 units from their December peak, which was the highest reading since the 1980s. RBS Greenwich Capital said that the housing sector is "more than holding its own in the face of higher but not yet high mortgage rates." The rise in the Mortgage Bankers Association mortgage purchase applications for the week ending June 11 indicates that this strength has continued into early June.
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