The four exchanges vying to clear the US credit default swap market are ready or almost ready, but the market’s fragmented regulatory structure remains a vexing problem for Congress.
Executives from CME Group, Intercontinental Exchange and NYSE Euronext told members of the House of Representatives’ Agriculture Committee on Monday that they were ready to launch CDS index products now or within the next three weeks.
Eurex’s representative said its system would be operational in the first quarter of 2009.
Johnathan Short, vice-president and general counsel of Intercontinental Exchange, told the committee that ICE would be ready to clear CDS contracts by year-end.
“We would address the current backlog of trades that exists by putting those in the clearing house and hopefully addressing some of the systemic risk that exists in the marketplace,” Short said. He added that ICE...