To enable the use of loans as collateral in financing transactions among trading counterparties and central banks, Markit will provide loan pricing and other market data to make it possible for Euroclear Bank to extend its pool of collateral to include loans in triparty collateral management transactions.

Scheduled to be deployed next year, the joint service will increase refinancing possibilities for loan portfolios and diversify bank funding sources, say the pair.

In addition, Euroclear Bank's delivery-versus-payment settlement services will be integrated with Markit's ClearPar and Clear electronic platforms for loan trade settlement.

A new asset servicing platform for syndicated loans that links Markit's messaging hub for agents and lenders with Euroclear Bank's expertise in event reporting and payment execution will be developed and Markit data will be used to expand reconciliation services available through Euroclear Bank's LoanReach platform.

Joe Widner, global head, loan processing and portfolio management, Markit, says: commented: "Our shared goals are to help the market grow through new solutions such as using loans as collateral, and to reduce risks and inefficiencies by automating trade and cash settlement."

Jo Van de Velde, head, product management, Euroclear, adds: "We are very excited to have found in Markit a partner with a unique franchise and proven track record in the syndicated loans area. Our respective services are complementary and even stronger when offered jointly."