About a-team Marketing Services
The knowledge platform for the financial technology industry
The knowledge platform for the financial technology industry

A-Team Insight Blogs

OTC Val Adds Valuation Capabilities for Hard to Value MBS and ABS Securities

Subscribe to our newsletter

OTC Valuations (OTC Val) has increased its valuation capabilities of illiquid mortgage backed securities, commercial paper, collateralised debt obligations, and other asset backed products. Bob Sangha, managing director at the vendor, explains that as well as providing a price, OTC Val is also focused on providing data on the modelling behind the price for these complex products.

According to analysis by the Market, Credit, and Risk Strategies group of Standard and Poor’s, Level 3 assets rose 15.5% from the second quarter. OTC Val contends that many of these securities are being reclassified as Level 3 assets as holders cannot rely on broker quotes or quotes without the level of price transparency required for financial reporting purposes.

It is therefore claiming to address these data issues via its valuation process, which it says is based on proven fair value estimation and model-based techniques. The vendor indicates that clients can use these techniques to satisfy audit and internal risk compliance requirements for securities with no direct market observable prices.

Sangha explains: “In this environment, market participants are as concerned about the assumptions and data behind a product’s price as the price itself. Our valuation methods enable us to provide the required level of transparency and disclosure. In addition, we employ a variety of reasonableness tests to ensure consistency and accuracy, while utilising (FAS 157 Level II) observable market inputs where possible. We also follow the recommendations from the IASB Expert Advisory Panel’s recent publication titled Measuring and Disclosing the Fair Value of Financial Instruments in Markets that are No Longer Active.”

Subscribe to our newsletter

Related content

WEBINAR

Upcoming Webinar: Unlocking value: Harnessing modern data platforms for data integration, advanced investment analytics, visualisation and reporting

4 September 2025 10:00am ET | 3:00pm London | 4:00pm CET Duration: 50 Minutes Modern data platforms are bringing efficiencies, scalability and powerful new capabilities to institutions and their data pipelines. They are enabling the use of new automation and analytical technologies that are also helping firms to derive more value from their data and...

BLOG

AI is Helping to Solve New ESG Data Challenges: ESG Briefing Review

The peculiar demands that ESG data integration places on capital markets participants requires powerful techniques that are increasingly being provided through artificial intelligence, A-Team Group’s recent ESG Data and Tech Briefing London heard. From data quality monitoring and analytics to supply chain analysis and investment management, AI-based tools are already offering automated solutions to some...

EVENT

RegTech Summit London

Now in its 9th year, the RegTech Summit in London will bring together the RegTech ecosystem to explore how the European capital markets financial industry can leverage technology to drive innovation, cut costs and support regulatory change.

GUIDE

AI in Capital Markets: Practical Insight for a Transforming Industry – Free Handbook

AI is no longer on the horizon – it’s embedded in the infrastructure of modern capital markets. But separating real impact from inflated promises requires a grounded, practical understanding. The AI in Capital Markets Handbook 2025 provides exactly that. Designed for data-driven professionals across the trade life-cycle, compliance, infrastructure, and strategy, this handbook goes beyond...