Clearing OTC Derivatives

The most recent financial crisis clearly demonstrated the highly interconnected nature of the global financial markets and the shortcomings resulting from weaknesses in cooperation and regulatory coordination. OTC Derivatives were strongly implicated by the G20 and in the aftermath of the crisis the global community agreed on a regulatory approach to reduce their impact on systemic and financial risk. This thesis retraces the agenda and regulatory attempts by international standard setters, as well as the EU, U.S., and Switzerland to reform the derivatives market and harness systemic risk through clearing. It comparatively analyses the strengths and weaknesses of the regulation, as well as carves out strategy proposals for national regulators to manage the new threats to financial stability in the wake of the regulatory reform.