Central Clearing House for CDS

May 2 (Bloomberg) -- Traders of credit-default swaps maystart using a clearing house this year to reduce the risk ofcounterparties failing to meet their obligations, Bank of AmericaCorp. said in a research report. Firms including Deutsche Bank AG, JPMorgan Chase & Co. andMorgan Stanley set a deadline earlier this year of September toset up a central processing system for the $62 trillion market.The system, to be known as the Clearing Corporation, will cut therisk of a market failure by spreading the losses from any failureto meet obligations, Bank of America strategist Glen Taksler inNew York said in a note to clients today. ``In its early stages, this proposal may take effect for asmall number of trades, among a small number of counterparties,toward the end of 2008,'' Taksler wrote.