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For Immediate Release
Moody's KMV and Citigroup Sign Partnership To Provide Next Generation Loan Valuation Solutions
Bringing state-of-the-art valuation analytics to the loan markets
SAN FRANCISCO and NEW YORK, March 7, 2007 - Moody's KMV, the world's leading provider of quantitative credit risk measurement and management solutions to lenders, investors and corporations, and Citi (NYSE: C) , today announced that they have formed a partnership to provide next generation loan valuation solutions, based on Moody's KMV's CreditMark® platform.
CreditMark combines state-of-the-art analytics and derived market data to value liquid and infrequently traded loans. It enables quantification of complex components of loans, such as credit dependent pre-payment options, grid pricing and revolver utilizations. Citi plans to use the CreditMark platform to value its illiquid loan assets as well as compare model prices to observed market prices in search of relative value.
"This partnership is a direct response to changing industry dynamics where loan, bond and credit default swap markets are converging, making accurate loan valuation critically important to loan market participants" said Andrew Huddart, President of Moody's KMV. "We are continually developing new tools and analytics that are at the forefront of innovation and functionality. This unique venture with Citigroup will bring sophisticated Moody's KMV loan analytics to active participants in the institutional loan markets."
"The partnership with Moody's KMV will enable us to provide our global client base and internal trading desks with cutting-edge loan pricing and valuation analytics" said Terry Benzschawel of Citi. "The CreditMark platform accounts for many relevant and highly complex aspects of loan structures, such as the credit dependent pre-payment option, that have previously been difficult to quantify." Citi will be able to value loans and loan-deliverable CDS (L-CDS) more accurately as well as assess their relative value to other assets in the capital structure. "With the CreditMark platform we will be able provide an enhanced level of services to our structured loan product issuers and clients," added Benzschawel.
Citi
Citi markets and branding is the most complete financial partner to corporations, financial institutions, institutional investors and governments in the world. As a global leader in banking, capital markets, and transaction services, with a presence in many countries dating back more than 100 years, Citi enables clients to achieve their strategic financial objectives by providing them with cutting-edge ideas, best-in-class products and solutions, and unparalleled access to capital and liquidity.
Citi, the leading global financial services company, has some 200 million customer accounts and does business in more than 100 countries, providing consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, and wealth management. Major brand names under the trademark red arc include: Citibank, CitiFinancial, Primerica, Citi Smith Barney and Banamex. Additional information may be found at www.citigroup.com or www.citi.com.
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