CDS are contracts that transfer the credit risk of a reference entity or instrument from a buyer of credit protection to a seller of credit protection. The Bank for International Settlements estimates that gross notional amounts of outstanding CDS at end-2013 were approximately $21 trillion. IOSCO believes that improving transparency in this market will increase the efficacy of the G20 commitments to reform the OTC derivatives markets. 

IOSCO today published the consultation report Post-Trade Transparency. The report’s analysis is based on a review of relevant works of international standard-setting bodies and academic literature and an examination of publicly available transaction-level post-trade data about CDS transactions before and after the introduction of mandatory post-trade transparency in certain CDS markets in the United States. 

IOSCO reached a preliminary conclusion that the data does not suggest that this introduction of mandatory post-trade transparency had a substantial effect on market risk exposure or market activity for those CDS products and encourages each of its members to take steps to enhance post-trade transparency in the CDS market in its jurisdiction.