Daily II has a post Banks Succeed In Slashing Unconfirmed-Trade Backlog which discusses an improvement in the processing of credit derivative trades. The key in this story, though, is the result pointed out in the story that "the number of unconfirmed trades dropping 50% from 150,000 to 74,000 in the six months ending March 31."
So there were 74,000 trades executed that hadn't cleared on March 31; what if there were a market shock on that date? I don't know how the uncleared trades would be handled in the event of a major market move, but I think it likely that there would be a tremendous mess that would take significant amounts of time and expense to sort out. Plus, there would likely be significant losses to some firms that had made trades that were uncleared and turned out to be rejected.
The same story has this fun fact: "According to the FSA, it took the largest banks 44 days to confirm a basic credit derivatives trade and about twice that for complex deals." Anyone with an E-Trade account can get confirmation of a stock trade in a few seconds, by contrast.
So, credit derivatives are skyrocketing in their importance in global financial markets, have been noted as a relatively poorly understood potential source of systemic risk by world financial leaders (such as Greenspan), and yet the systems used to handle these securities are essentially a steaming pile of horse manure. Great!