Online credit

Two former derivatives traders at Deutsche Bank have launched creditex, an online platform for trading credit derivatives worldwide. Credit derivatives are used widely by companies wishing to hedge credit risk on a loan or investment. The party which buys the default protection pays an annuity to the seller in exchange for cover against a specified event. Swaps Monitor, a publication which specialises in the over-the-counter derivatives market estimates that US commercial bank holding companies held some US$234 billion in credit derivatives as of September last year. creditex offers a negotiations platform for participants and it will also provide historical data. Investors include major US names J P Morgan, Morgan Stanley Dean Witter and Pacific Life Insurance Company.( http://www.credi-tex.com)