. unlike organised markets, such as stock exchanges, which were tightly regulated to protect against market abuse, insider trading, and other transgressions, and were required to disclose information on prices and orders, over - the - counter markets were not. at the height of the crisis, neither market players nor public authorities could monitor the market for corporate credit - default swaps. hence market participants were unable to evaluate the counterparty risk appropriately. risk mitigation failed, which ultimately resulted in a drying - up of the whole market. since that time, many jurisdictions have implemented regulatory frameworks ensuring that counterparties report otc derivatives trades to trade repositories. in europe, all derivatives contracts, not only otc derivatives, are subject to this reporting obligation. in the united states, the reporting and public dissemination of publicly reportable swap transactions in all asset classes is already effective. the same in japan, which has the most active otc derivatives market in asia and where the country ’ s first repository was approved in march this year. in europe, it is expected that the european securities and markets authority will adopt a decision on the registration of trade repositories still this month and that counterparties will start to report all asset classes to the repositories as of january next year. so, on the surface, it appears we have achieved our goal. but have we really? does, for example, the supervisor responsible for the supervision of a large cross - border financial institution at the consolidated level have direct and immediate access to information on otc derivatives transactions that encompass all transactions entered into by all entities of this group? is the information accessible, in other words can it be easily aggregated across trade repositories and jurisdictions? my answer would be a clear no! bis central bankers ’ speeches in the single supervisory mechanism, the ecb, as i ’ ve already said, will be responsible for the supervision of such large banking groups, some of which are global systemically important financial institutions ( sifis ) with large derivatives businesses. the access to data relating to foreign ( that is non - eu ) subsidiaries of financial groups, where an authority – in this case the ecb – has supervisory responsibility at a consolidated level, is key to assessing the overall risk exposure of a given banking group. of course, access to data should always be in line with the authorities ’ mandate and with the cpss - iosco guidance, issued last month, on authorities ’ access to

and we are not yet there. in fact, at the current stage, no authority has a complete overview of the risks in otc derivatives markets or is able to examine the global network of otc derivatives in depth. hence, fragmentation of data, both at the data storage level and at the access level, is putting at risk the implementation of the overall objective of the g20. the good news is that the g20 leaders, who continuously monitor the implementation of the reform, are aware of this issue. the financial stability board, assisted by the cpss and iosco, has only very recently begun a feasibility study on various approaches to address these shortcomings and intends to issue a report in the first half of next year. bis central bankers ’ speeches central clearing the second area i would like to concentrate on is central clearing. a lot of progress has also been achieved in the area of central clearing. however, although legislation is in force in europe, it may still take more than one year before the clearing obligation becomes effective. actually, this sunday ( 15 september ), the deadline by which central counterparties in europe have to apply for authorisation under eu legislation will expire. within another six months – by mid - march 2014, at the latest – the authorisation process should be completed, after which the mandatory clearing obligation will be determined. the good news is that the share of cleared contracts in relation to total otc derivatives transactions outstanding has consistently increased over the last five years. in the case of interest rate derivatives, for example, the share of cleared transactions increased from 16 % in 2007 to over 50 % by the end of 2012. we expect this share will increase continuously as the clearing obligation comes into effect in many countries. progress is, however, different among asset classes, and substantial scope still exists for further increasing central clearing. a number of challenges still remain. let me mention two key points in this regard. first, i would like to recall that the introduction of mandatory clearing obligations raises new challenges in terms of the distribution and management of financial risk beyond the risk concentration in central counterparties. indeed, mandatory clearing implies that an increasing share of the risks arising from otc derivatives transactions will also be concentrated in a few major clearing banks. this is because the mandatory clearing requirement implies that a larger pool of market participants will need to have access to central counterparties, while only a small part of this pool will be able to access the counterparties directly. indeed, central counterparties