us banks in big trouble?, page-22

Whilst the use of bilateral netting provides substantial risk reduction where market participants have significant derivative exposures, it is of little use where individual participants take large one way positions as demonstrated by AIG. For banks that undertake a mix of own and customer hedging and trading in both directions significant protection is provided.

The increased use of cash collateralisation to over 70% of contracts provides further credit protection and the use of cash collateralisation has increased significantly since the GFC.

And while the numbers are big, these are based on underlying - for short dated interest and FX contracts, credit risk is a small multiple of notional value.