Deutsche Bank and other investment banks are working on plans to develop a clearing house for the credit derivatives markets in an effort to allay growing regulatory and investor fears about “counterparty risk”. In particular, the banks are trying to develop a scheme that would only allow institutions with strong capital bases and credible trading histories to clear trades in the credit default swap markets with a central counterparty. The aim is to ensure that members of this clearing house club would be more protected from the risk of a trader or investor failing to meet their obligations.