Interactive Data to Provide Valuations for TALF Loans

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Mon Oct 5, 2009 9:00am EDT

Exclusive Agreement with Prism Valuation Enables Company to Offer Valuations for
Complex Instruments and Helps Clients Meet Reporting Requirements
NEW YORK--(Business Wire)--
Interactive Data Corporation (NYSE: IDC), a leading provider of financial market
data, analytics and related solutions, today announced that its Pricing and
Reference Data business will offer Prism`s valuations for loans made available
by the Federal Reserve Bank of New York in connection with the Term Asset-Backed
Securities Loan Facility (TALF). Through an exclusive agreement with Prism
Valuation, Interactive Data is able to offer valuations for TALF loans, along
with other complex financial instruments such as OTC derivatives and structured
products. 

The TALF loan valuation process takes 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. 

"We have observed that an increasing number of our clients - mutual funds,
institutional asset managers, insurance companies and hedge funds - are taking
advantage of the unique investment opportunities resulting from the TALF
program," said Liz Duggan, managing director, Evaluations, Interactive Data. "A
valuation provider needs a comprehensive understanding of these hard-to-value
instruments, including the optionality embedded within the loans. We have
collaborated with Prism Valuation to provide our clients with valuations that
reflect the unique characteristics of 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." 

Interactive Data is also hosting a webcast on Tuesday, October 6 at 11 a.m. ET
to discuss the TALF program and related valuation topics. Rob Haddad, director
of Evaluated Services for Interactive Data and Keldon Drudge, chief technical
officer for Prism Valuation, will host the webcast. Click here to register. 

As background information, the TALF was launched in March 2009 and was designed
to increase credit availability and stimulate the securitization markets by
providing up to $200 billion in loans to finance the purchase of eligible new,
and certain legacy, highly-rated securities that are backed by, for example,
auto loans, credit card receivables, small business loans, student loans, and
commercial mortgage loans. 

According to the terms of a TALF loan, interest and principal cash flows from
the collateral are directly applied to the interest and principal payments owed
under the loan. In the event that the cash flows from the collateral are not
sufficient to service the cash flows due on the loan, the borrower generally has
the ability to surrender the collateral to the Federal Reserve Bank of New York
with no additional liability. This feature generally provides the borrower with
the economic equivalent of an American-style put option. 

About Interactive Data Corporation

Interactive Data Corporation (NYSE: IDC) is a leading global provider of
financial market data, analytics and related solutions to financial
institutions, active traders and individual investors. The Company's businesses
supply real-time market data, time-sensitive pricing, evaluations and reference
data for millions of securities traded around the world, including hard-to-value
instruments. Many of the world's best-known financial service and software
companies subscribe to the Company's services in support of their trading,
analysis, portfolio management and valuation activities. Interactive Data,
headquartered in Bedford, Mass., has approximately 2,400 employees in offices
located throughout North America, Europe, Asia and Australia. Pearson plc (NYSE:
PSO; LSE: PSON), an international media company, whose businesses include the
Financial Times Group, Pearson Education, and the Penguin Group, is Interactive
Data Corporation's majority stockholder. 

Interactive Data`s Pricing and Reference Data business provides global
securities pricing, evaluations and reference data designed to support financial
institutions` and investment funds' pricing activities, securities operations,
research and portfolio management. Interactive Data collects, edits, maintains
and delivers data on more than 6 million securities, including daily evaluations
for approximately 2.8 million fixed income and international equity issues.
Interactive Data specializes in `hard-to-get` information and evaluates many
`hard-to value` instruments. 

Pricing, evaluations and reference data are provided in the U.S. through
Interactive Data Pricing and Reference Data, Inc. and internationally through
Interactive Data (Europe) Ltd. and Interactive Data (Australia) Pty Ltd. 

For more information about Interactive Data Corporation and its businesses,
please visit www.interactivedata.com

Interactive DataSM and the Interactive Data logo are service marks of
Interactive Data Corporation. 

About Prism Valuation

Founded in 2006, Prism Valuation provides services that replicate the pricing
and risk analysis capabilities of a structured products dealer, with an emphasis
on hard-to-value assets. Their valuation philosophy is built on three pillars
"People - Data - Models." Using this foundation, Prism Valuation`s quantitative
analysts develop and extensively test appropriate structured product valuation
engines. For more information about Prism Valuation please visit
www.prismvaluation.com.

Investors
Interactive Data Corporation
Andrew Kramer, +1 781-687-8306
andrew.kramer@interactivedata.com
or
Media
Interactive Data Corporation
Brian Willinsky (U.S. media), +1 781-687-8291
brian.willinsky@interactivedata.com
or
Sue Mitchell (European media), +44 (0)20 7825 8076
sue.mitchell@interactivedata.com

Copyright Business Wire 2009

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