The over-the-counter (OTC) derivatives markets provide a good example. Those markets, especially the newer markets for credit derivatives, have been growing very rapidly. Until 2005, however, the confirmation of trades remained largely decentralized and manual.
The result was a huge backlog of unconfirmed trades, which, to the extent it resulted in inaccurate trade records, had the potential to exacerbate market participants' market and credit risks. The Federal Reserve Bank of New York has taken the lead, working with other domestic and international supervisors, in helping the OTC derivatives market develop a stronger clearing and settlement infrastructure.