Bloomberg News

Markit Group Starts Using Messaging Service for Leveraged Loans

May 11, 2012

Markit Group Ltd. is now receiving electronic messages for leveraged loans using Financial Products Markup Language, the company said today in an e-mailed statement.

Citigroup Inc. (C:US) and JPMorgan Chase & Co. (JPM:US) are the first banks to move from testing to implementing the system created to send loan messages to Markit using the electronic data exchange. FpML will be used to replace faxes as the way to send loan information, such as interest payments, paydowns, and rollover of interest rates, Markit said in the statement.

Markit, which provides derivative and bond data and competes with Bloomberg News parent Bloomberg LP, purchased Depository Trust & Clearing Corp.’s Loan/SERV messaging program in 2010. The loan market is trying to move away from fax and e- mail transmissions to streamline repayments and trading.

“Migrating to FpML for transmitting agent notices streamlines our operations, makes sense from an environmental standpoint and helps the lenders we serve,” Atilla Karasapan, global head of loan and credit risk operations at Citigroup, said in the statement.

The Markit loan messaging hub receives about seven million notices from agent banks by fax, e-mail and FpML every year, the company said in the news release. Switching to electronic messages can help to decrease the manual processes and reduce errors in updating portfolio information. It also will save about 17 million pieces of paper a year, Markit said.

“The ability to receive notifications related to syndicated loans electronically via FpML marks another leap towards greater transparency and efficiency in the loan market,” Alice Taormina, senior vice president at Blackstone Group LP’s GSO Capital Partners LP, said in the statement. “Having a streamlined way to receive loans data directly from agent banks enhances the accuracy and timeliness of data maintained by custodians and portfolio managers.”

Leveraged loans are those rated below BBB- by Standard & Poor’s (MHP:US) and less than Baa3 at Moody’s Investors Service. (MCO:US)

To contact the reporter on this story: Kristen Haunss in New York at khaunss@bloomberg.net

To contact the editor responsible for this story: Faris Khan at fkhan33@bloomberg.net


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Companies Mentioned

  • C
    (Citigroup Inc)
    • $53.7 USD
    • 1.25
    • 2.33%
  • JPM
    (JPMorgan Chase & Co)
    • $61.07 USD
    • 1.30
    • 2.13%
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