The top of everyone's discussion list is the pending bank stress test parameters and results. Most notable is the (leaked) target for tangible common equity of 3% which is slightly lower than expectations. I don't suspect they would target an insurmountable level....so expect results to come in close to that 3%. Michael Milken reminds us that it's very important to focus on the proper capital structure.
Morgan Stanley's CFO says they would "consider" paying back their $10B TARP line. This comes 1 month after their CEO Mack said "[it's the] wrong time" to pay it back.
Hartford insurance is trying to sell it's property insurance unit for ~$4B. Spreads were initially weaker as this was viewed as the crown jewel. However, spreads have since recovered to only slightly weaker in line with the rest of the sector.
The UK government may embrace a very different way to sell their government debt (ahead of a pending flood of issuance). They are considering syndicating the debt issuance in much the same way as corporate issuers do. A pundit would view this as a sign of weakness....needing a broker/dealer to aggressively peddle that which previously 'sold itself'.
The ICE and CME are racing to gain share in the clearing and settling of credit derivatives. Obviously, this will be quite lucrative given the triple digit growth over the past few years of credit derivatives. At this point, ICE seems to be taking the lead.
S&P cut their ratings on ~$8B of CDO's backed by residential mortgages. 29 of these 39 tranches face further pending cuts.
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