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Fitch Announces the Formation of a New Affiliate, Fitch Risk Management and an Exclusive Relationship with Loan Pricing Corporation
NEW YORK, November 6, 2001 - In response to the growing demand for risk management services and to continue to broaden the company's growing global ratings franchise, Fitch, the international rating agency, announces the launch of a new affiliate, Fitch Risk Management, Inc. The new affiliate will provide innovative, analytical tools and services that assess and manage risk in support of financial institutions, investors and regulatory bodies throughout the U.S. and Europe.
In addition, Fitch also announces that it has entered into an exclusive agreement with Loan Pricing Corporation (LPC), a Reuters Company. LPC provides financial institutions around the world with global syndicated commercial loan data, news and analytics. As part of the agreement, Fitch Risk Management and LPC will continue to provide services to approximately 30 existing risk management member institutions. The exclusive agreement brings together LPC's historical databases and loan-level analytic products with the established credit expertise and global coverage of Fitch, forming an enhanced set of products and service solutions for clients of both firms.
Acting as a development platform for a suite of products and services that incorporate traditional default and recovery analytics with credit, portfolio and operational risk disciplines, the new Fitch affiliate will market and support LPC's suite of premier risk management products, comprised of LPC Risk Rater and LPC Loan Loss database. Additionally, Fitch will utilize Loan Connector, LPC's market leading internet-based product distribution platform, as a product marketing and distribution channel.
LPC's Loan Loss database contains more than 10 years of historical data and includes over 56,000 non-defaulted loans from approximately 32,000 private and public borrowers worldwide along with more than 3,600 defaulted loans including their post-default cash flow experience. This is the largest database on loan loss of this type available. The LPC Risk Rater is a statistically-based risk rating tool that estimates default probabilities and expected losses for a time horizon of up to and including five years.
"There is a growing acceptance and use of quantitative models in the US and International markets. By combining our traditional credit expertise with what we believe to be the premier loan loss database and model available, we will provide a risk management alternative for institutions that will incorporate both credit and market risk," said Stephen Joynt, President and Chief Operating Officer of Fitch.
"As all types of financial institutions face new challenges in assessing risk in response to Basle II, we believe that Fitch Risk Management will be a sound alternative for our clients, and forward the intention of Basle by providing incremental sources and methods for measuring risk," said Gloria Aviotti, Group Managing Director of the newly formed Fitch unit. Jim Davis, Loan Pricing Corporation President and Chief Executive Officer, said: "By teaming up with Fitch, LPC will be better able to serve the global loan market's risk management needs. The combination of Fitch's credit expertise with LPC's comprehensive default and loss data significantly enhances the value proposition for LPC's customers across all geographies as they will benefit from new and enhanced methods for measuring risk"
About Loan Pricing Corporation
Loan Pricing Corporation (LPC), a Reuters Company, has provided financial institutions around the world with the most complete and accurate information on bank loans since 1985. LPC's reach on loan market news and information spans across the United States, Europe, Eastern Europe, Middle East, Africa, Latin America and Asia with market news delivered via publications, on-line news services and databases. LPC has earned its position as the authoritative source of loan market information and analysis by its constant attention to the loan industry and development of state-of-the-art products and services for bankers, borrowers, and loan investors.
About Fitch
As the international rating agency, Fitch is fully committed to serving capital market participants by providing the highest quality ratings and research. Fitch has a rating presence in 75 countries and 40 offices worldwide. Fitch rates over 2,000 financial institutions, 1,000 corporates and maintains surveillance on 3,300 structured financings and 17,000 municipal bond ratings in the U.S. tax-exempt market. Fitch also rates over 800 insurance companies plus nearly 70 sovereigns. With a combined analytic, professional staff, and support staff of 1,100, Fitch covers the Financial Institutions, Banks, Corporates, Loan Products, Structured Finance, Insurance, Sovereigns and Public Finance markets worldwide. Fitch has dual headquarters in New York and London and is wholly owned by FIMALAC, Paris.
About FIMALAC
FIMALAC is an international business support services group based in Paris, with offices and operations in 40 countries and 7,500 employees around the world. The company's focus is comprised within three main areas; financial services through the operations of Fitch, industrial services through diversified operations in the hand tool and garage equipment markets with FACOM and logistics services through international operations in chemical storage with LBC. Mr. Marc Ladreit de Lacharrière, is the founder and CEO of FIMALAC and is also Chairman of Fitch.
For more information contact:
Fitch
Jim Jockle
Tel: 212-908-0547
Email: james.jockle@fitchratings.com
Darren Davies
Tel: 212-908-0390
Email: darren.davies@fitchratings.com
Loan Pricing Corporation
Kevin Elphick
Tel: 212-833-9362
Email: kelphick@loanpricing.com
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