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BTG Pactual Supports London Credit Business with Quantifi XL

BTG Pactual, the largest independent investment bank based in the emerging markets, has selected Quantifi XL to support a new credit business it is building at its London base. The bank’s London office selected the Excel-based Quantifi XL software for the pricing and analysis of its credit products after assessing a range of other solutions and on the recommendation of a London-based investment bank.

Headquartered in Brazil, BTG Pactual resulted from the takeover of UBS Pactual by investment firm BTG in 2009, a merger that gave the bank 25 years of experience and international offices in London, New York and Hong Kong.

Alessio Farhadi, credit trader at BTG Pactual, explains: “We needed an advanced, flexible tool for pricing and structuring to support our growing credit business. Quantifi came highly recommended and we have been very impressed with the breadth and sophistication of the product. We were able to get up and running immediately, which allowed us to scale our business rapidly.”

Rohan Douglas, CEO of Quantifi, says the BTG Pactual installation is small in the scale of its business, but adds: “New business is not an uncommon scenario for us. Our tools are sophisticated, but users can get up and running quickly, scale quickly and become competitive quickly. For a start-up business this is attractive. Clients often start with an Excel-based, entry level product like Quantifi XL, like what they see and then grow, giving us the opportunity to do more with them.” One such client is German regional bank LBBW.

Douglas says the software is quick to implement and easy to use as it is based on the familiar Excel spreadsheet, but also because it has turnkey interfaces to data sources such as Markit and Bloomberg. “One of our goals is to make software as easy as possible to use as people don’t have much time to learn and maintain it. Even complex analysis needs a simple interface and sensible defaults,” he says.

With nearly 140 clients and a focus on credit markets, Quantifi is building its business on the three pillars of credit products; broader OTC derivatives products, including a new range of interest rate modelling tools; and counterparty credit risk solutions.

“We are seeing a pick-up in interest in our products across the board, driven by the need to improve credit business and by companies setting up credit business,” says Douglas. “Counterparty risk and credit valuation adjustment have become a major focus for banks and, although these are early days for our interest rate software, it is being looked at by buy side institutions struggling with the valuation of OTC derivatives.” The company’s first customer for its next generation credit valuation adjustment pricing tool, Quantifi CVA, is European commercial bank WestLB, which signed up last month.

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