Mike Nierenberg and Jeffrey Verschleiser, who were previously co-heads of mortgage trading at Bear Stearns, have been promoted in a series of managerial changes at the bank. Verschleiser will head up a new business focused on distressed mortgages. In his new position, he will develop strategies to employ the firm's capital and manage capital for others, according to a spokeswoman. Nierenberg has been promoted to head of global rates and foreign exchange, a business which the firm has expanded and will continue to grow. He will also help to expand the precious metals effort in foreign exchange as well as local markets business. Scott Eichel and Josh Weintraub have been promoted to co-heads of MBS and ABS trading and Adam Siegel has been promoted to head up MBS and ABS credit trading.

Merrill Lynch is getting an infusion of old blood. According to reliable market sources, CEO John Thain has talked Jeff Kronthal into working with the company as a consultant to fixed-income chief David Sobotka. Kronthal was reportedly ousted in 2006 by former CEO Stan O'Neal, but before then he oversaw Merrill's CDO underwriting and trading business. Company officials declined to comment about the situation.

J. Giordano Securities Group, a Stamford, Conn.-based investment banking firm that serves small-cap and middle market companies, eliminated its high-yield sales and trading group as of Thursday, Jan. 10. Firm President James Giordano said that the group was not very large and was eliminated due to market conditions. He also said his firm would consider reviving the group in the future, once market conditions improve. J. Giordano's high-yield sales and trading group focused on small and midsize companies the company described as "under-covered by the Wall Street community." Its focus extended to non-traditional fixed income securities in the municipal and asset-backed sectors and generally focused on aircraft-related issues within the asset-backed space, according to the firm's Web site.

Jeanne Bartlett has been appointed to head the structured finance group at the offshore law firm Appleby. Bartlett will be based in the firm's Cayman office but will focus on developing a global business. She was formerly at DLA Piper, where she headed up the firm's debt capital markets and securitization division before she retired from private practice in 2006 to write her third novel. The new appointee was employed at Slaughter and May in the mid-1980s.

Morgan Stanley has decided to assimilate its securitized products group into its credit business. Armins Rusis, head of credit trading in London, has been promoted to head of credit trading for the U.S., Europe, the Middle East, and Africa, as well as head of global mortgage-backed securities trading. The firm has also combined its interest rates and currencies businesses into a new unit that will be headed by Roberto Hoornweg, the former co-head of the interest rates and currencies divisions.

IndyMac Bancorp announced on Jan. 15 that it would cut 2,400 jobs, or 24% of its workforce, according to reports. The lender already eliminated 1,600 jobs last fall. CEO Mike Perry indicated in a letter to employees that an additional 500 to 1,000 positions would be cut in the next six months. Perry also said that the company was eliminating 27% of its staff with its outsourced and temporary vendors, mainly in India. He noted that IndyMac still has a significant capital cushion and liquidity but must maintain these by making sure its balance sheet doesn't grow. IndyMac's stock is down 25% over the last two weeks and 89% over the last year, according

to reports.

The Securities Industry

and Financial Markets Association (SIFMA) appointed T. Timothy Ryan, Jr. as chief executive officer. Ryan replaces Marc Lackritz, who retired on Dec. 31. Prior to joining SIFMA, Ryan was vice chairman of investment banking for financial institutions and governments at JPMorgan and a member of the investment banking coverage management committee. Before joining JPMorgan in 1993, Ryan was the director of the Office of Thrift Supervision. He was also director for both the Resolution Trust Corp. and the Federal Deposit Insurance Corp. From 1983 to 1990, Ryan was a partner in the Washington, DC office of the law firm Reed, Smith, Shaw & McClay, and from 1981 to 1983 he was Solicitor of Labor at the U.S. Department of Labor. Starting in February, Ryan will be headquartered in SIFMA's New York office.

SIFMA also appointed both Sean Davy and Jack Wiener as managing directors. Davy will oversee the association's MBS and securitized products division, while Wiener will serve as its general counsel and be responsible for its corporate credit markets division. Davy was a director and global relationship manager for Deutsche Bank. Wiener was deputy general counsel for the Depository Trust & Clearing Corp. (DTCC).

Swiss Re recently structured and placed the largest catastrophe bond to finance French windstorm risks, according to an insurance industry publication. The 200 million ($294 million) transaction is part of a three-year reinsurance agreement between Swiss Re and Groupama S.A. Swiss Re Capital. Also, the French windstorm issuance is part of a multiyear program enabling Swiss Re to support up to 800 million ($1.1 billion) of Groupama's risk management strategy and to satisfy future cover needs. In case of a windstorm in France, the program would pay a claim triggered by a parametric index based on wind speeds at various locations.

Moody's Investors Service downgraded 340 million of Constant Proportion Debt Obligations (CPDOs) that are exposed to portfolios of financial names. The affected CPDOs represent 63% of the existing financial CPDOs and 11% of all CPDOs rated by Moody's, the rating agency said. The downgrades are the result of the continuing spread widening of financial names underlying these transactions, including monolines and investment banks, Moody's said. The three biggest instances of widening seen between Nov. 27, 2007, and Jan. 11, 2008, were XL Capital Assurance, which gapped out to 698 basis points from 481 basis points; FGIC, which moved to 696 basis points from 555 basis points; and MBIA Insurance Corp., which moved to 293 basis points from 179 basis points. Out of the downgraded transactions, the Castle II and Chess III deals also reflect the negative impact of realized mark-to-market losses associated with multiple recent deleveragings of these transactions, Moody's said, adding that the deleveragings were done to maintain compliance with the cap on leverage specified in the transaction documents.

Fitch Ratings affirmed MBIA Insurance Corp.'s AAA' rating on a $1 billion capital infusion and gave it a stable outlook. MBIA raised $1 billion on Jan. 11 amid concerns of a downgrade. Fitch said its rating was based on the company's resolution of near-term capital issues, but noted that MBIA still faces heightened challenges from subprime-related losses. Fitch will continue to evaluate the impact that MBIA's reduced earnings have on its franchise. MBIA was also assigned a double-A rating to the $1 billion surplus notes. According to reports, however, MBIA's surplus notes have dropped 12% since they were sold because of concerns that the company might need to seek out more money. Fitch expressed concern that if the market moves away from the use of bond insurance, MBIA and other guarantors could struggle to grow their business in the future. The rating agency also noted that MBIA has been hampered with a reduction in trading value compared to its peers because of exposure to SF CDOs.

Ambac Financial Group said it will issue at least $1 billion of equity and equity-linked securities. The company said it may also take on additional capital from reinsurance or issuance of debt securities. By raising the additional capital, Ambac said it expects to meet or exceed Fitch Ratings' current AAA' capital requirements. The company also announced that it will reduce the quarterly dividend on its common stock from $0.21 per share to $0.07 per share. Ambac has been working with Credit Suisse as its financial adviser. The news comes just as Ambac said it would take a $5.4 billion, pre-tax write-down in the fourth quarter, $1.1 billion of which is related to its ABS CDO exposure. Ambac expects to report a net loss per share of up to $32.83 for the fourth quarter ended Dec. 31. Michael Callen, who has been on Ambac's board since the company went public in 1991, has been named presiding director and a member of the audit and risk assessment, compensation and governance committees of Ambac's Board of Directors. He succeeds Robert Genader, whose retirement from the company was effective Jan 16. Meanwhile, Moody's Investors Service placed the triple-A insurance financial strength ratings of Ambac Assurance Corp. and Ambac Assurance U.K. on review for possible downgrade. In the same rating action, Moody's also placed the ratings of the holding company, Ambac Financial Group's senior debt at Aa2' and related financing trusts on review for possible downgrade. Moody's stated that last Wednesday's rating action follows Ambac's announcement of record losses, a capital raising plan and the retirement of its CEO.

ECMBX, the European analogue of the U.S. CMBX index that references Euro CMBS, has been postponed again from Jan. 14 to potentially March, according to market reports. The plan is to have four ECMBX variants - AAA' and BBB' in both euros and sterling. Each index will have CDS referencing 20 constituent bonds, slightly less than the 25 names in CMBX. But market participants can look forward to a new European residential mortgage index - ERMBX - which has been proposed and could even go live earlier than ECMBX.

Fitch Ratings lowered the outlook on four U.K. CMBS transactions to negative from stable. This follows a review of 38 U.K. CMBS deals that closed in the last two years with maturity dates within the next four years, which is a segment that is now at risk from downward rating pressure. Fitch is concerned that current property capital values may be insufficient to allow final principal repayments at loan maturity. Most CMBS deals rely heavily on the sale or refinancing of the charged assets for repayment of its debt, but with values falling it is unlikely that a sale or refining would deliver sufficient funds to meet principal payments. Fitch said that deals that are more susceptible to downward risk are U.K. transactions that closed in 2006 and 2007 with maturities in the next four years.

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