Markit has launched an independent data source for pricing of collateralized loan obligations (CLO), to be used by financial institutions for price discovery, price verification, valuation and risk management.
The service covers more than 5,000 investment-grade tranches of U.S. and European CLOs. Markit says it will ensure transparent valuations by providing detailed information on data inputs and the assumptions used in the evaluation process. The service includes access to Markit's team of CLO evaluators as well as a price challenge process.
Nathan Kirk, director and head of U.S. Securitized Products at Markit, highlighted the firm's transparent methodologies and expertise in gathering and using observable market data. "We are pleased to extend our capabilities in providing high quality evaluated pricing services to the CLO market in order to support customer needs," Kirk says.
The new service is an expansion of Markit's evaluated pricing business for securitized products, including residential mortgage-backed securities, commercial mortgage-backed securities and consumer asset-backed securities plus corporate, sovereign and municipal bonds.
Markit says it will expand the CLO pricing service later this year to cover mezzanine and equity tranches of CLOs.