Following its selection of Asset Control’s AC Plus earlier this month, NYSE Euronext’s valuations service subsidiary, Prime Source, has announced a partnership with Paris-based Pricing Partners under which the firms will combine their valuations offerings. The valuations vendors hope that the agreement will allow them to extend their instrument and global coverage.
Pricing Partners’ focus on valuing structured derivatives products should extend Prime Source’s offering in this area and the latter’s geographic reach should add to the former’s global footprint. Eric Benhamou, CEO of Pricing Partners, explains the drivers for them: “Working with Prime Source is a great way for us to rapidly reach a global market, thanks to the vast network of the world’s leading stock market operator.”
Marie-Hélène Crétu, CEO of Prime Source, adds: “Pricing Partners are experts in the valuation of structured derivatives products, having created and developed some of the most advanced mathematical models in the industry. This actually enhances our valuation services offer available via Prime Source. It gives our customers an even wider choice for the valuation of a variety of financial instruments from a single provider, without the need to appoint many specialist suppliers to meet complex valuation needs.”
Launched in February 2008, Prime Source provides financial institutions with a portfolio valuation service covering a range of asset classes and financial instruments. It offers both automated and bespoke valuation services and uses prices from sources including markets, dealer contributions and valuation models.
The valuation space has received a lot of interest over the last year, as regulatory scrutiny of fair value pricing has increased as a result of the credit crisis. However, the influx of new entrants into the market has been such that market participants have been flooded with choice. The likely outcome of such a boom will be consolidation, as more and more vendors make the decision to partner rather than compete in a market faced with tightening budgets.