U.S. regulators are poised to approve rules today that willrequire most swaps trades to be reported to the public, a responseto lax derivatives oversight in the run-up to the financialcrisis.

The rules up for a vote at the Securities and ExchangeCommission (SEC) will specify what information has to be reportedpublicly as well as data intended for regulators who surveil themarket. The regulations are the latest step in efforts by the SECand Commodity Futures Trading Commission (CFTC) to increasetransparency in the $691 trillion swaps market.

The SEC's rules come more than six years after the collapse ofLehman Brothers Holdings Inc. and government rescue of AmericanInternational Group Inc. that was rooted in part in unregulatedswaps. By creating a record of swaps trades, regulators aim tomonitor for systemic risk while giving investors a better idea offair prices.

Five Wall Street banks dominate the U.S. swaps business.JPMorgan Chase & Co., Goldman Sachs Group Inc., Bank of AmericaCorp., Citigroup Inc., and Morgan Stanley control 95 percent ofcash and derivatives trading for U.S. bank holding companies as ofSept. 30, according to the Office of the Comptroller of theCurrency. While the CFTC oversees the bulk of the market, the SECregulates swaps based on a single company's bonds or loans,equities, and indexes based on nine or fewer securities.

The CFTC has already approved rules that require dealers andother investors to provide price, volume, and other information tothe databases and the public.

Banks have a sought a delay on rules to handle the reporting oflarge trades. They say that making data on block trades immediatelypublic will increase trading costs because other traders will beable to detect the large demand and front-run their orders. Itisn't clear how the SEC will address the issue.

The SEC measures up for a vote today also will lay out rules forthe swap data repositories, the central record-keepers of theinformation. The databases will function partly like the pricefeeds operated by stock exchanges that report equity trades to thepublic.

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