Markit plans European ABS transparency initiative

Source: Markit

Markit, a leading provider of independent data, portfolio valuations and over-the-counter (OTC) derivatives trade processing, today announced that it is working with leading dealers to facilitate the distribution of European asset-backed securities (ABS) prospectuses and investor reports in a freely available manner.

In response to calls by the European Commission for greater transparency in the European ABS markets, Markit is developing an industry-led solution with the support of several dealers to encourage best practice. Dealers involved in this initiative include: BNP Paribas, Citi, Deutsche Bank, Goldman Sachs, JPMorgan, Lehman Brothers, Morgan Stanley, Royal Bank of Scotland and UBS.

Amany Attia, Managing Director and Head of European Securitised Products at Lehman Brothers, said: "This initiative shows that the structured finance industry is taking the lead in tackling the need for greater transparency in the European ABS markets today. A number of dealers have made a commitment to support Markit's platform, and we hope that this greater availability of key deal and performance information will restore investor confidence in these markets."

Lee Rochford, Head of Fixed Income Securitisation for Europe at Royal Bank of Scotland, said: "We are pleased to be supporting Markit's initiative which will address the European Commission's calls for greater transparency in the structured finance markets, and we look forward to working with the broader group to bring best practice to the European ABS markets."

Markit will consolidate prospectuses and investor reports for European ABS transactions on a single website and will make the information freely available to all buy-side and sell-side firms and third parties, as permitted by local regulation.

Rick Watson, Managing Director and Head of the European Securitisation Forum, said: "We welcome Markit's initiative to launch an industry-led solution to provide freely accessible surveillance information for European securitisations. This will bring greater transparency to the European structured finance industry, and will work in concert with the ESF's own efforts to boost the availability of performance information in these markets."

Ben Logan, Managing DireDirector of Structured Finance at Markit, said: "This initiative is designed to provide greater transparency to investors in European ABS and will streamline the performance surveillance process. We also expect it to spur the development of analytics and valuations by third party providers which will ultimately bring greater price discovery and liquidity to the European ABS markets."

The initiative dovetails with Markit's plans to launch Markit Valuations Manager, the first global, multi-bank, cross-asset client valuations platform. Scheduled to go live in the second half of this year, it will offer clients increased transparency in OTC derivative and cash valuations by providing accurate and consistent third-party valuations on a single electronic platform.

Markit owns the only integrated pricing and performance monitoring service for European ABS securities, providing clients with collateral performance information alongside daily, independent consensus bond pricing sourced from 27 market makers.

Additional dealers are expected to join this new initiative over the coming months, and the website should be operational by the end of the third quarter of 2008.

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