The Obama administration on Wednesday unveiled a sweeping plan to regulate OTC derivatives in a move to increase transparency and reduce risk in a largely unregulated market worth more than $680,000bn. The new rules would force “standardised” OTC derivatives to be cleared through central clearinghouses to reduce the risk of investors being over-exposed to a single counterparty. The plan could force banks and other big corporate users of derivatives to set aside more capital to cover potential losses.

This entry was posted by Gwen Robinson on Thursday, May 14th, 2009 at 5:24 and is filed under Capital markets. Edit this entry.