Mark-it chief executive Lance Uggla declined to provide the dollar value of the new 36% equity investment. But he said the company could now handle two small cash acquisitions – deals valued at less that $10 million. He added that Mark-it was now closed to additional investors unless they joined as partners during a strategic acquisition. This means banks such as Barclays, BNP Paribas, Bear Stearns and HSBC will remain clients of Mark-it but not shareholders.
The company plans to launch a convertible bond pricing service by April. It is developing this in-house with the help of a number of its bank backers. It also plans to re-run its data to create a cleaner and deeper historical set of credit default swap prices – essential for bank risk management and modelling. Mark-it is also offering bi-monthly prices on synthetic collateralised debt obligations (CDOs), tranches of CDOs and CDO baskets. It also provides prices on single-name credit default swap options and options on credit derivatives indexes.
Mark-it already offers almost 2,000 individual credit default swap price curves on a daily basis, and plans to increase this number to 2,500. It wants to offer customers a complete set of credit information on any single company by mid-year. Uggla says his preferred method of delivery is via the internet. This full service is likely to include news feeds.
Uggla said Mark-it is also developing joint ventures with credit software analytics providers to improve its data feed connections into financial institutions. Likely partners include: Algorithmics, Infinity, Moody’s KMV, Reuters, RiskMetrics, Standard and Poor’s, Summit, SunGard and Thomson Financial.
The final part of Mark-it’s credit platform development this year is to offer independent portfolio price evaluation. This would mean financial institutions could use Mark-it to provide third-party valuations for their entire credit portfolios – something that is increasingly important due to regulatory and accounting changes. To achieve this, Mark-it needs to either purchase or develop sophisticated credit portfolio models.