Chairman Conaway, Ranking Member Boswell and Members of the Subcommittee:
My name is Larry Thompson. I am General Counsel of The Depository Trust & Clearing Corporation (“DTCC”). DTCC is a participant-owned and governed “utility” supporting the financial services industry. Through its subsidiaries and affiliates, DTCC provides clearing, settlement and information services for virtually all U.S. transactions in equities, corporate and municipal bonds, U.S. government securities and mortgage- backed securities and money market instruments, mutual funds and annuities. It also provides services for a significant portion of the global over-the-counter (“OTC”) derivatives market. To give you some idea of the magnitude of DTCC’s involvement in U.S. capital markets, in 2010, the Depository Trust Company (“DTC”) settled more than $1.66 quadrillion in securities transactions.
Since 2003, DTCC has been working with financial market participants and with regulators – our two core constituencies – to automate the trade confirmation process for credit default swaps (“CDS”), essentially replacing a manual error-prone process, where only 15% of all CDS trades were matched, with a process whereby virtually all CDS trades are matched through an automated system provided by DTCC.
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