Risk Management Policy Group (CRMPG), led by Goldman Sachs Group
managing director and former Federal Reserve Bank of New York
president E. Gerald Corrigan, identified deficiencies in post-trade
derivatives processing as a serious systemic risk to financial
markets. Two months later, taking off from that report, the New
York Fed called representatives of top dealer banks together to
begin to map out an improvement plan, and the progress since in
automating over-the-counter credit default swaps (CDS) processing
has been dramatic.
As of mid-November, when Depository Trust & Clearing Corp.
(DTCC) announced that its Trade Information Warehouse, a key
element in post-trade CDS automation, had gone live, 80 percent of
credit derivatives trades globally were being electronically
confirmed on the DTCC Deriv-Serv platform, up from 15 percent in
2004. In a Nov. 21 letter to the New York Fed's current president,
Timothy Geithner, 17 dealer firms said they were turning attention
to the next area of need: equity derivatives. |
