The number of Middle East-based hedge funds is set to increase. In January, Abu Dhabi headquartered First Gulf Bank launched the first hedge fund of significance in the region. The fund, Al Saqer (“the Falcon”), is a macro-strategy hedge fund and has a capitalization of Dh3 billion ($817 million).

Goldman Sachs might still be the firm to beat when it comes to global M&A but it has just lost the chairman of its European investment banking business, Claudio Costamagna, who will leave this month after 17 years at the firm.

By Lawrence White

The Chicago Mercantile Exchange has launched a snowfall index. From the end of February, investors were able to trade snowfall futures and options based on snowfall in New York and Boston. “From municipal snow removal budgets to holiday retail sales, snowfall, or lack thereof, can have a major impact on local and regional economies,” says Scott Mathews, president of CTA WeatherEX. “Our clients will be able to hedge the expense or revenue side of the snowfall equation.” It will be a little too late for those affected by the snowstorms in New York in February. A record 27 inches of snow fell in 24 hours, costing the city an estimated $20 million.

Second-lien financings grew dramatically in 2005. Total US second-lien loan issuance alone amounted to more than $22 billion in 2005. In Europe, second-lien issuance totalled €5.75 billion in 2005, rising from €1.88 billion in 2004.

The Swiss bank is making determined efforts to grow its US private banking business.

There was a message of serious intent in the choice of syndicate for Hong Kong-based Hutchison Whampoa’s proposed flotation of its Italian 3G business. The message from the market was equally clear. Despite the best efforts of Goldman Sachs, HSBC, JPMorgan, Merrill Lynch and Morgan Stanley to get the deal away, the US$7 billion price offered by investors was simply too unpalatable for an investment that has cost Hutchison between US$8 billion and US$9 billion. The IPO was pulled.

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Fund managers' priorities for 2006

DrKW has embraced blogging in a big way. The fondness for internet opinion boards has spread from the bank’s IT staff to the rest of the bank, which now has about 300 internal web logs, used for sharing work ideas.

Ucits III opens the door to sustainable growth of single-stock futures. Over the past five years the exchange’s USF market has grown by an average of 57% a year, and there may be more to come.

“Citigroup should wipe the floor with everyone in credit derivatives. What happened?”

Invest with female mutual fund managers to save on trading costs

Jollibee Bee, mascot, all dressed up to collect company's award for Best-managed consumer goods company in Asia.

Lehman's Grant Bowman has a taste of Superbowl fame in the Pittsburgh Steelers practice squad.

FX heads aspire for gold in L’Etape du Tour bike race.

Summer cum laude

The ASEAN tigers: back with a roar?

Latin America’s infatuation with the perpetual bond market shows no signs of slowing down. Metrofinanciera, one of Mexico’s biggest mortgage lenders, is the latest corporate to reveal its interest in issuing a perp. The company’s chief executive, José Armando Guzmán González, says that he is mulling over the idea but declines to provide further details.

“Probably a good idea” was how a leading market participant described the news that the International Capital Market Association (Icma), the International Swaps and Derivatives Association (Isda) and The Bond Market Association (TBMA) have formed a Global Capital Markets Board (GCMB).

Société Générale Corporate & Investment Banking has appointed Serge Topolanski as its deputy head of Europe and Asia global foreign exchange activities. Topolanski, who is based in Paris, will supervise the global foreign exchange French team and the overall FX options business. He reports to Lars Hakanson, head of global foreign exchange activities, Europe and Asia.

Regulators outnumbered the regulated at a meeting at the Federal Reserve Bank of New York on February 16. Representatives of 15 bank and securities regulators and exchanges were relieved to hear that the world’s 14 largest credit derivatives dealers had fulfilled their promise, made last October, to cut by 30% the number of credit derivatives trades remaining unconfirmed for 30 days or more by January 31 2006. The backlog, which arose from high-velocity trading and assignment by hedge funds in a market with underdeveloped systems for initial confirmation of trade details, had sparked widespread alarm across the industry. More good news: electronic confirmation has risen to 62% of trade volume, from 46% in September 2005.

It’s the time of the year, with the bonus season over, when people moves are back in swing. So far, several have caused a bit of a stir.

The UK government’s commitment to imminent PFI transactions appears to be wavering. Have critics of the funding strategy won the argument?

Reserve confirms Wachovia deal qualifies for tier 1. And that could spark over $40 billion of copycat deals.

Hugo Chávez’s war of words with US president George W Bush has escalated, with the Venezuelan president threatening to sell his nation’s oil refineries in the US. Chávez has threatened to sell Citgo Petroleum’s refineries and divert US oil exports to other countries. “I could easily order the closing of the refineries that we have in the United States. I could easily sell the oil that we sell to the United States to other countries...[to] real friends and allies like China, India or Europe,” he told supporters at a rally last month.

Rio de Janeiro now offers a developing market alternative to Chicago.

Cheyne Capital Management sold one of the largest-ever European arbitrage CLOs last month via Nomura. The €1 billion Cheyne Credit Opportunity CDO 1 incorporated several structural features to overcome problems that could arise from its relatively large size. In contrast to typical CLOs, which are normally half the size, 40% ramped up at launch and have around a year to complete sourcing loans, Cheyne Credit Opportunity has a two-year time period to ramp up fully. This extra flexibility will be particularly useful. The competition for leveraged loans will be greater than ever, given that an estimated 35 CLOs are operating this year, compared with about 25 last year.

The sale of Hotspot has prompted a torrent of speculation about the future of other ECNs. But it seems the rumours about new owners for FXall are true.

Government rumoured to be planning new bond deal although holdouts issue remains unresolved.