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Edeus asset service to help lenders understand risks

Edeus says its new asset quality assessment service will allow lenders to understand the current risks of all the mortgages in any of their asset pools.

Managing director Alan Cleary says: “The main cause of the credit crisis is that no one knows what mortgage books are worth anymore so no one is prepared to trade them.

“But this product helps lenders price asset purchase transactions – either by identifying and excluding loans outside their pre-determined risk parameters or by maintaining the pool size but negotiating price differentiation to reflect inherent risks. Effectively, we’ve found a cure for the credit crunch. We are marketing this product to hedge funds, investment banks, private equity firms, and mortgage lenders – anyone trading mortgage assets. This is a hugely important development for the mortgage market; it’s going to take the market by storm.”

Edeus’s service will assess 100 per cent of the loans in a pool – making its scope much greater than the 15 per cent that it claims traditional due diligence processes analyse.

The service will quantify the current risks within any pool of assets rather than just reflecting the risks present at the time of origination.

Edeus Asset Management director Richard Monahan says: “The report we provide at the end of the service is detailed, unambiguous – and totally cutting edge. The findings are based not only on our state of the art technology, but also our industry origination experience. Whatever the size of the pool, every loan is considered from multiple perspectives. It will take the unknown element out of the asset trading.”

The assessment report can be tailored to include reasonability of income assessments, land registry checks, sample fraud investigations, delinquent loan analysis, traditional manual due diligence and a FSA register check.


Easy come, easy go

Volatility and periods of pronounced weakness have marked European equity markets following four years of strong gains. Banks were initially at the epicentre of these market moves but concerns about the economic outlook have begun to affect the wider market. We think that the root causes of this volatility – a higher risk premium and softer growth – are here to stay for the foreseeable future.


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