Bear Stearns' Fixed Income Division Debuts Enhanced Price Adjusted Credit Risk Evaluator.Business Editors NEW YORK--(BUSINESS WIRE)--June 30, 2003 Bear, Stearns & Co. Inc. unveiled today an enhancement to its Price Adjusted Credit Risk Evaluator (PACRE(TM)), which will allow investors to evaluate and price high-yield Collateralized Debt Obligations (CDOs) consistently with underlying collateral markets. PACRE will allow investors to calculate credit-adjusted spreads on individual CDO (Collaborative Data Objects) A programming interface from Microsoft for accessing MAPI-based e-mail, calendaring and scheduling servers. Originally called "OLE Messaging" and "Active Messaging," CDO wraps the Enhanced MAPI library into a COM object that provides the tranches. The new enhancements are available through Bear Stearns' proprietary analytics system, BondStudio(TM), developed by the firm's Fixed Analytics and Structured Transactions Department (F.A.S.T.). Michael Nierenberg, head of CDO Trading, said, "This new credit-adjusted spread model represents another step in our effort to enhance liquidity and transparency in the secondary market for CDOs, an effort which Bear Stearns has dedicated increasing levels of resources to over the past three years." Further explaining the added benefits of the new product, Gyan Sinha, head of Bear Stearns Asset-Backed Securities and CDO Research, added, "We are applying valuation frameworks such as Option Adjusted Spread Option adjusted spread (OAS) is the flat spread over the treasury yield curve required to discount a mortgage-backed security's (MBS) volatile coupon payments to match its market price. (OAS OAS See: Option adjusted spread ) which are routinely used by investors in the mortgage markets to better understand the risks and rewards in the tranching of credit risk." Founded in 1923, The Bear Stearns Companies Inc. (NYSE NYSE See: New York Stock Exchange : BSC (Binary Synchronous Communications) See bisync. ) is the parent company of Bear, Stearns & Co. Inc., a leading investment banking and securities trading and brokerage firm. With approximately $33.5 billion in total capital, Bear Stearns serves governments, corporations, institutions and individuals worldwide. The company's business includes corporate finance and mergers and acquisitions, institutional equities and fixed income sales, trading and research, private client services, derivatives, foreign exchange and futures sales and trading, asset management and custody services. Through Bear, Stearns Securities Corp., it offers financing, securities lending Securities Lending When a brokerage lends securities owned by its clients to short sellers. Notes: This allows brokers to create additional revenue (commissions) on the short sale transaction. , clearing and technology solutions to hedge funds, broker-dealers and investment advisors. Headquartered in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. , the company has approximately 10,500 employees worldwide. For additional information about Bear Stearns, please visit the firm's Web site at http://www.bearstearns.com. |
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