How do the regulatory authorities supervise OTC market?

[neoechelon]

Guys,

I am looking for some standardized guideline(specifically regulators use when they investigate financial institutes) regarding OTC derivatives market supervision.

1. For the purpose of market supervision(from regulator's perspective), what kind of information can be helpful? Can I get it from banks' reporting material to FRB or SEC? If so, can I access it?

2. Which factor is significant between transaction counterparties and how supervisors acknowledge it and judge whether the individual risk factor in a certain transaction can spill over into overall financial market?


I guess my questions seem a bit vague but truly appreciate any kind of tip to get some info on this.

Could anybody help me out?

Thank you,

 

[alain]

Basel II and the IRB approach. I think the FRB has all the documents. Google for Basel II. Check implementation details. It all boils down to regulatory capital or Risk Weighted Asset (RWA).