This paragraph from the Office of the Comptroller of the Currency’s Quarterly Report on Bank Derivatives Activities gave me a chuckle:

“While bank supervisors normally have concerns about market or product concentrations, there are three important mitigating factors with respect to derivatives activities. First, there are a number of other providers of derivatives products, such as investment banks and foreign banks, whose activity is not reflected in the data in this report. Second, because the highly specialized business of structuring, trading, and managing derivatives transactions requires sophisticated tools and expertise, derivatives activity is appropriately concentrated in those institutions that have made the resource commitment to be able to operate this business in a safe and sound manner. Third, the OCC has examiners on-site at the largest banks to continuously evaluate the credit, market, operation, reputation and compliance risks of derivatives activities.”

It’s worth noting that they’ve mindlessly copy-and-pasted the same paragraph in the quarterly report for years now… and their use of that awful phrase, “resource commitment,” is a sure sign they don’t know what the hell is going on. Safe and sound? Spare me.