Regulators Seeking Details on Derivatives Deals

An international group of banking regulators wants major banks, securities dealers, and insurers to report the size and composition of their derivatives activities.

The top 100 derivatives dealers worldwide, which are involved in 90% of all derivative deals, would record the notional and replacement cost of all their contracts, according to the proposal released Thursday by the Bank for International Settlements. They also would specify whether the counterparty was an end-user or another dealer, and whether the derivative was a swap, option, or other instrument.

Regulators said they want to learn the exact size of the derivative market and the most popular types of derivatives. This information will help them monitor the market, according to the proposal.

The public has until Sept. 30 to comment on the draft. Then the settlements bank will issue a final report, which U.S. authorities will republish here for public comment. Reporting is expected to begin on Dec. 31, 1997.

The International Swaps and Derivatives Association supported the proposal, saying regulators need the data to properly monitor the market. The group also said it may discontinue a less-comprehensive annual survey it conducts.