Creditflux Newsletter

Plenty of loan market professionals have a life outside the market (we are told), but few can boast outside achievements on a par with Van Kampen’s loan portfolio manager Philip Yarrow. On the Morgan Stanley-owned manager’s website, he modestly describes himself as a former squash professional. In fact, he is the author of the leading guide to this sport which, as we understand it, involves hitting a ball against a wall with a racket. Squash: steps to success, Yarrow’s 1997 seminal tome, is by a large margin Amazon’s best-selling book on the topic.

Outside achievements II. Ciprian Nicolae, a credit trader at Citi in London, also had a life before credit. When he was an accountant at KPMG, he created the model used in the privatisation of one of the largest pig farms in Romania, according to his posting on a well known social networking site. We would love to know if anyone else in the credit market has done something they can actually be proud of.

Why did so many high-tech companies buy synthetic CDOs? First Singapore’s Venture Corporation, then Belgium’s Melexis (both electronics companies), disclosed big write-downs on CSOs. Now, Australian energy technology company Ceramic Fuel Cells admits to taking a big bath (relative to its size, at least) on structured credit investments it bought indirectly from WestLB. Perhaps high-tech companies were more easily convinced of the merits of cutting edge financial innovation than, say, concrete makers.