The leading knowledge platform for the financial technology industry
The leading knowledge platform for the financial technology industry

A-Team Insight Blogs

Thomson Reuters Expands Fixed Income Valuation Offering with New CLO Pricing Capability

Thomson Reuters announced today the launch of a new Collateralised Loan Obligation (CLO) evaluated pricing service, delivered via DataScope Select, its strategic distribution platform for non-streaming global content and pricing. This new pricing capability will provide end-of-day valuations for global cash CLOs, including both broadly syndicated and middle market deals, and give investors greater transparency and the regulatory foresight necessary for these products.

The revival of CLOs has been highlighted by the recent growth of new issuance in this space, with over $6 billion of newly issued deals introduced since last year. Market estimations predict $10-20 billion of new issuance by the end of this year and a potential doubling in 2012. Additionally, the secondary market for CLOs has seen an increase in trading activity, as fixed income investors are seeing relatively high returns in this space. This expanding investor demand for CLO products is driving the need for third party pricing vendors to provide high quality evaluated pricing.

Thomson Reuters new CLO pricing capability offers a cost-effective solution for capturing pricing information and delivering a depth of analysis not previously available in the market. The solution fully unpacks the assets underlying an individual CLO such as prepays, defaults and recoveries, in a more granular approach to credit assumptions. Particular emphasis is placed on the breakout and analysis of CCC rated loans, defaulted loans, second liens, covenant lite loans, bonds and any structured product assets in the deals.

Jayme Fagas, head of Evaluated Pricing, Thomson Reuters, said: “The past 12 months have witnessed a transformation in the CLO market. Products have been made simpler with higher-quality assets and more investor protection, making them an increasingly attractive investment. In a niche data market that is characterised by a small number of players, Thomson Reuters is differentiated in providing truly unique loan-level and structural analysis. And by leveraging the same delivery infrastructure that supports its broader global Portfolio Valuation Solution, Thomson Reuters can also drive down the cost of pricing CLO tranches.”

The pricing capability utilises Thomson Reuters LPC loan pricing platform to calculate and assess the Weighted Average Price of each CLO’s portfolio of assets. It also incorporates Moody’s Analytics CDONet Library, a comprehensive global CLO deal library that covers close to 100% of the market. This launch builds upon the already extensive fixed income content available via Thomson Reuters Portfolio Valuation Solution, which includes independent, accurate and timely pricing for more than 2.5 million instruments.

Related content

WEBINAR

Recorded Webinar: Entity identification and client lifecycle management – How financial institutions can drive $4 billion in cost savings

A new model in Legal Entity Identifier (LEI) issuance has created significant opportunities for financial institutions to capitalise on their KYC and AML due diligence. By becoming Validation Agents and obtaining LEIs on behalf of their clients, financial institutions can enhance their client onboarding experience, streamline their internal operations, and open the door to new,...

BLOG

SimCorp Collaborates with J.P. Morgan Securities Services to Deliver Front-to-Back Integration

SimCorp is collaborating with J.P. Morgan’s securities services to provide mutual clients with front-to-middle office and custody integration. The integration is live at an asset owner in Asia-Pacific and is designed to address costly and fragmented investment processes that contribute to operational risk by automating workflows and increasing data transparency. The companies suggest post-trade processing...

EVENT

Data Management Summit Virtual

The Data Management Summit Virtual will bring together the global data management community to share lessons learned, best practice guidance and latest innovations to emerge from the recent crisis. Join us online to hear from leading data practitioners and innovators from the UK, US and Europe who will share insights into how they are pushing the boundaries with data to deliver value with flexible but resilient data driven strategies.

GUIDE

Entity Data Management Handbook – Fifth Edition

Welcome to the fifth edition of A-Team Group’s Entity Data Management Handbook, sponsored for the fourth year running by entity data specialist Bureau van Dijk, a Moody’s Analytics Company. The past year has seen a crackdown on corporate responsibility for financial crime – with financial firms facing draconian fines for non-compliance and the very real...