Interactive Data Corporation, a leading provider of financial market data, analytics and related solutions, today announced that it has expanded its award-winning* evaluated pricing services capabilities in Germany. A new team of evaluators based in Interactive Data’s Frankfurt office will provide local market knowledge and expertise in the evaluation of German domestic fixed-income securities in this important marketplace.
Adding local evaluation capabilities in Germany further expands Interactive Data’s position as a leading provider of independent evaluated pricing services to financial institutions globally and helps to better support the unique client needs of the German marketplace. The move demonstrates Interactive Data’s commitment to local markets and is part of its overall strategic expansion plan across Europe, particularly in Germany, France and Italy. The Company already has nearly 900 employees in its offices across Europe.
“The expansion of our evaluated pricing expertise into the German marketplace, combined with our global reach and extensive coverage of the fixed-income markets, will benefit our clients in Germany and abroad, helping them to meet their valuation and related regulatory requirements,” said Anthony Belcher, European fixed-income director, Interactive Data. “Our local evaluators are closer to the market and can obtain more in-depth local knowledge and market colour as input into our evaluations. As part of our global team of over 130 evaluators, this additional local expertise brings us wider knowledge and resilience. We aim to provide our clients with increased transparency into our evaluations process, and additional insight on the asset classes for which we produce evaluated prices.”
Interactive Data already provides daily evaluated pricing to over 20 financial institutions in Germany. One client, MEAG MUNICH ERGO AssetManagement GmbH, added: “We are pleased to be working with Interactive Data as a valuation provider. We place high value on obtaining transparency for the valuations and a responsive challenge process, as provided by Interactive Data, to comply with the requirements of third parties such as auditors.”
In terms of outstanding nominal value, the German bond market is one of the largest in the world and has seen an increase in issuance with debt rising sharply over the past few months. In addition, the crisis in the financial markets that began in 2008 has led to changes in the way that thinly-traded securities are valued by German investment management firms. In December 2009, Germany’s Federal Financial Supervisory Authority, The Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin) amended the country’s valuation rules in the Investment Fund Accounting and Valuation Directive (InvRBV) to provide clear requirements for the investment industry. As a result, investment management firms either need to set up and maintain an in-house pricing team, which can be both costly and burdensome, or use an independent third-party source and verify prices against other external sources. This directive is in line with best practice in the wider European investment management industry, and many firms already use multiple independent valuation sources.
* In 2010, Interactive Data was named ‘Best Third-Party Valuation Provider’ in the Credit Awards Americas 2010. Interactive Data has also won the award as ‘Best Evaluated Prices Services Provider’ from Inside Market Data and Inside Reference Data for three consecutive years from 2009-2011.