MSN MoneyCentral – Leading credit derivatives dealers have committed to take steps that could lead to a “dramatic improvement” in market practices and to cut further the backlog of outstanding tradesthat has plagued the fast-growing market.
The pledges come amid continuing scrutiny from the New York Federal Reserve and other US and European regulators, and represent a continuation of industry efforts that began last October after the New York Fed had summoned 14 dealers to discuss the problems in the market.
In contrast to last year, when some hedge funds initially criticised the dealers’ proposed actions, the latest commitments were quickly supported by the Managed Funds Association, a hedge fund industry group.
“We applaud the major dealers for reaching out to our members for their support in achieving the 2006 targeted objectives,” said John Gaine, president of the MFA.
“We firmly believe that we can achieve broad market support and a dramatic improvement in credit derivative market practices,” the MFA added.
