Reuters Delivers New Derivatives Pricing Service

A New service from Reuters promises to deliver bespoke valuations for derivatives and other complex securities. The Reuters DataScope Derivatives Pricing Service is part of Reuters' overall strategy to speed up the valuation process for complex instruments, the London-based firm says.

Requested prices for bespoke transactions are provided using Reuters' methodology for valuation. Reuters claims the DataScope Derivatives Pricing Service is a major step toward transparency in pricing and methodology, as well as speed in the valuation of derivatives.

"Many of our clients trade financial instruments for which establishing the correct market price can be difficult. This service allows them to tap into the independence and integrity of Reuters to give a custom-made guide to the value of securities they hold," said Tim Rice, global head of Reuters Pricing and Reference Data, in a release.

Source URL: http://www.wallstreetandtech.com/showArticle.jhtml?articleID=206903772

Publish Date: 14 March, 2008

Northern Trust expands OTC derivatives trading services

Northern Trust has expanded its services for over-the-counter (OTC) derivatives trading to include independent valuation of a comprehensive array of derivatives for its custody, fund administration and investment operations outsourcing clients.

The automated solution links to third-party specialist providers of OTC derivatives valuations and utilizes a system of tolerance checks to arrive at optimum pricing and performance measurement for the complex financial instruments.

"Independent valuation has become a crucial piece of the derivatives puzzle as institutional investors seek portfolio transparency to meet internal risk and compliance goals, as well as emerging regulation and industry best practices," said Judson Baker, product manager for derivatives processing related services at Northern Trust. "For our 'best of breed' approach, Northern Trust has selected independent pricing firms specializing in a range of swaps and options. Each provider has an extensive history in running market-standard valuation models, and Northern Trust brings them together in a cost-effective solution with coverage across broad product types."

In addition to independent valuation, Northern Trust's derivatives processing initiative includes automated collateral management for OTC derivatives trades under International Swaps and Derivatives Association (ISDA) master agreements. The suite of services, integrated with Northern Trust's global infrastructure, provides end-to-end processing including calculation of exposures, making and receiving of collateral calls, managing collateral according to the terms of the credit support agreement, legal agreement documentation management, reconciliation and settlement.

"As volumes and product complexity in OTC derivatives continue to grow, so too do demands for independent valuations and greater transparency around these asset types," said Stephen Andress, global head of derivatives operations. "Northern Trust is continuously working to enhance its processing capabilities for derivatives, allowing our clients to create a tailored service solution that integrates foreign exchange, cash management, derivatives clearing and other complementary services to support their diverse investment strategies."

Publish Date: June 28, 2007

Source URL:http://www.finextra.com/fullpr.asp?id=15844

Asset Managers Push Custodians to Offer Independent Pricing Services for OTC Derivatives

Asset managers that enter into over-the-counter (OTC) derivatives contracts and structured products with sell-side trading desks are demanding independent valuation services from their custodians, according to several sources. In response to scrutiny from institutional investors, compliance officers and risk managers, as well as internal boards of directors, investment managers are taking a keen interest in how these complex instruments are priced.

Read complete article at http://www.financetech.com/showArticle.jhtml?articleID=197005764

Published date: Feb 13, 2007

BoNY expands valuations service for OTC derivatives and asset classes

The Bank of New York, a global leader in securities servicing, has expanded its independent valuation service for a broad spectrum of over-the-counter (OTC) derivative products and asset classes to include European swaptions, foreign exchange options and OTC equity options.

The Bank already provides valuation services for interest rate swaps and credit default swaps.

The Bank's clients have access to daily valuations of their global OTC derivative portfolios as part of the comprehensive account information available to them through INFORM, the Bank's Internet-based information delivery and transaction platform.

"As greater numbers of institutional investors include the use of derivatives in their investment strategies, the demand for independent pricing has never been greater," said Richard P. Stanley, executive vice president and head of Global Investor Services Product Management and Accounting Services at The Bank of New York. "This expansion of our service greatly enhances our ability to report on OTC derivatives valuations, which improves our clients' capacity to monitor and assess their holdings as well as understand and manage their risks."

As one of the world's leading custodians and administrators to fund companies and plan sponsors, Stanley stressed that the Bank's derivatives- related offerings represent a core competency that will grow in sophistication as such clients increasingly utilize derivatives globally.

In addition to independent valuations of derivatives, the Bank recently established a derivatives product team led by Ahmad Sharif, managing director within Global Investor Services, which is focused on creating a comprehensive end-to-end process for servicing derivatives used by hedge funds and institutional investors.

Source: http://www.finextra.com/fullpr.asp?id=13293

Publish Date:05/02/2007