The Regulation of the Emerging Markets Loan Market

The secondary market in emerging markets loans began in 1983 after the debt crisis and has grown into one of the worlds more significant capital markets with a turnover in 1996 of over $5 trillion of debt. Even though based in New York, there has been virtually no external regulation of this market. This article explores why this might have been so and concludes that the market in loans is not a securities market and does not naturally fall under the aegis of any U.S. regulatory authority. The market, in fact, is a rare example of a single international over-the-counter market