Interactive Data Corp announced an exclusive agreement with Prism Valuation to offer pricing and reference data for loans made available by the Federal Reserve Bank of New York in connection with the Term Asset-Backed Securities Loan Facility (TALF).
The TALF loan valuation process will take into account the value and assumptions of the underlying asset-backed securities (ABS) and commercial mortgage-backed securities (CMBS) collateral, the terms of the loan, and the value of the theoretical put option embedded in the loan.
Borrowers under the TALF program must value both the TALF-eligible securities and liabilities (TALF loans) for financial reporting purposes. Interactive Data already offers independent evaluations for the underlying TALF-eligible ABS and CMBS. In collaboration with Prism Valuation, Interactive Data now offers valuations for TALF loans.
“Under financial reporting standards, many financial institutions that choose to borrow under the TALF program will value these loans at fair value,” said Dushyant Shahrawat, senior research area director for TowerGroup. “Data providers like Interactive Data (and their solutions) can fill a unique industry need by providing valuation information for these loans that is not otherwise available in the industry.”