CreditTrade launches mark-to-market credit derivatives service

Credit derivatives inter-broker dealer and data provider, CreditTrade, and UK pricing company Totem Market Valuation, have launched a consensus-based, mark-to-market pricing service for banks.

The service, called Credit Accord, collects, aggregates and validates credit derivatives data from participating institutions, which is then supplied back to those institutions for mark-to-market calculations.

The joint venture combines the live credit markets experience of CreditTrade with Totem’s experience in consensus revaluation for middle offices. CreditTrade will supply pricing data for validation of Credit Accord data, along with consultation and IT support. Totem will supply operational infrastructure, data collection and administration of the service.

Krishna Biltoo, head of product development at CreditTrade, told RiskNews that the participating institutions were the main institutions in the credit derivatives market. "The venture brings more transparency to the credit derivatives market by supplying valid aggregated data," he said. “Through Credit Accord, institutions can mark-to-market their credit derivatives activities against a consensus of observed market prices.”

“Credit Accord clients can ask the questions they need to resolve mark-to-market issues without giving away their positions or their identity,” added James Prichard, a director at Totem Market Valuations.