Parameta Solutions, the data division of the TP ICAP, announced its partnership with OTC analytics and derivatives pricing firm Numerix on Tuesday to develop a system for more effectively valuing OTC derivatives.
Parameta Solutions and Numerix Join Hands
The partnership between the two companies came when the financial services industry witnessed mounting regulatory requirements for strict accounting standards, data reliability, and transparency. Further, the introduction of FRTB mandated the need for a higher quality of data for accurately marking OTC positions.
The regulatory pressure came when the Bank for International Settlements (BIS) revealed last November that the notional value of outstanding OTC derivatives climbed to a record high of $632 billion. It showcases the high demand for accurate data around OTC derivatives.
“As the regulatory requirements for third-party outsourcing, transparency, and risk factor liquidity have increased, the challenge of obtaining accurate and up-to-date valuation services has become more difficult. Simultaneously, technological changes are forcing financial institutions to reconsider their existing architecture and the data sources driving critical applications,” said Parameta Solutions’ Chief Product Officer, Ovie Koloko.
“By working together with Numerix, we believe that we can offer a truly unique solution to an issue that has only become more pronounced as financial institutions make greater use of OTC derivatives.”
A Strategic Partnership in the OTC Data Sector
The partnership is strategic, as Parameta is already a market leader in providing OTC data, and Numerix brings advanced analytics capabilities.
Parameta Solutions generated £177 million in revenue in 2022, contributing about 8.4 percent of TP ICAP's revenue, which closed the year with a pre-tax profit of £113 million. TP ICAP reportedly considered selling the data division for about £1.5 billion but terminated talks last month.
TP ICAP rebranded its existing pot-trade data and analytics division to launch Parameta Solutions in April 2021. On top of that, the unit gained the authorization of the Financial Conduct Authority in the UK to become a benchmark administrator.
“Transparency is a key factor in the growth of OTC markets. It is essential to have transparency in data, models, and their calibration to ensure confidence while trading these products,” added Steven O’Hanlon, the President and CEO of Numerix. “By combining Parameta’s extensive and diverse data with Numerix’s cutting-edge pricing models and advanced analytics solutions, we can build greater trust in this segment of the capital markets.”
Parameta Solutions, the data division of the TP ICAP, announced its partnership with OTC analytics and derivatives pricing firm Numerix on Tuesday to develop a system for more effectively valuing OTC derivatives.
Parameta Solutions and Numerix Join Hands
The partnership between the two companies came when the financial services industry witnessed mounting regulatory requirements for strict accounting standards, data reliability, and transparency. Further, the introduction of FRTB mandated the need for a higher quality of data for accurately marking OTC positions.
The regulatory pressure came when the Bank for International Settlements (BIS) revealed last November that the notional value of outstanding OTC derivatives climbed to a record high of $632 billion. It showcases the high demand for accurate data around OTC derivatives.
“As the regulatory requirements for third-party outsourcing, transparency, and risk factor liquidity have increased, the challenge of obtaining accurate and up-to-date valuation services has become more difficult. Simultaneously, technological changes are forcing financial institutions to reconsider their existing architecture and the data sources driving critical applications,” said Parameta Solutions’ Chief Product Officer, Ovie Koloko.
“By working together with Numerix, we believe that we can offer a truly unique solution to an issue that has only become more pronounced as financial institutions make greater use of OTC derivatives.”
A Strategic Partnership in the OTC Data Sector
The partnership is strategic, as Parameta is already a market leader in providing OTC data, and Numerix brings advanced analytics capabilities.
Parameta Solutions generated £177 million in revenue in 2022, contributing about 8.4 percent of TP ICAP's revenue, which closed the year with a pre-tax profit of £113 million. TP ICAP reportedly considered selling the data division for about £1.5 billion but terminated talks last month.
TP ICAP rebranded its existing pot-trade data and analytics division to launch Parameta Solutions in April 2021. On top of that, the unit gained the authorization of the Financial Conduct Authority in the UK to become a benchmark administrator.
“Transparency is a key factor in the growth of OTC markets. It is essential to have transparency in data, models, and their calibration to ensure confidence while trading these products,” added Steven O’Hanlon, the President and CEO of Numerix. “By combining Parameta’s extensive and diverse data with Numerix’s cutting-edge pricing models and advanced analytics solutions, we can build greater trust in this segment of the capital markets.”
