The notional amount of over-the-counter derivatives trades outstanding bounced back to reach $605 trillion by the end of June, according to figures released by the Bank for International Settlements.
The figure is up 10% on the level recorded at the end of 2008. A previous survey in May had reported a provisional notional outstanding amount of $592 trillion at the end of last year - a fall of 13.4% compared with six months before.
The latest survey revises the extent of last year's fall, putting the notional value of trades at the end of last year at $547 trillion. This would represent a plunge of almost 20% compared with mid-2008.
Despite the rebound in notional recorded in the latest survey, the total market value of trades decreased by 21% to $25 trillion at the end of June. Gross credit exposures arising from OTC derivatives trades also fell to $3.7 trillion, from a peak of $4.5 trillion in the previous survey.
In credit default swaps (CDSs), the notional value of outstanding contracts fell by 14% to $36 trillion at the end of June. The total market value of CDS trades fell by 42%.
In interest rates, the notional value of trades outstanding went up by 13% to $437 trillion. At the same time, the gross market value of trades decreased by 14% to $15 trillion.
In foreign exchange derivatives, an uptick in activity led notional outstanding to rise 10% to $49 trillion at the end of June. But the survey reports the total market value of forex derivatives decreased by 31% to $2.5 trillion. Similarly, the notional value of equity derivatives trades inflated 7% to reach $6.6 trillion by the end of June, while the total market value fell 16% compared with the end of 2008.
Elsewhere, the notional outstanding value of commodity derivatives contracts continues to decline in the latest survey, slipping 2% to $3.7 trillion. But this figure has slowed since the last survey in May, which showed commodity derivatives notional plummeting by 71% at the end of 2008. According to the latest survey, the total market value of commodity derivatives trades had contracted 17% by the end of June.
More on Derivatives
Central bank says dealers are moving trades offshore to avoid KRX's high cost
Wujiang Lou shows the impact of funding costs on option valuation
New fee structure amounts to a fourfold increase in some cases
Different treatment of public and private banks stymied netting – but this could now change
Sign up for Risk.net email alerts
Sponsored video: MarketAxess
Sponsored video: Tradeweb
Multifonds talks to Custody Risk on being nominated for the Post-Trade Technology Vendor of the Year at the Custody Risk Awards 2014
Sponsored webinar: IBM Risk Analytics
There are no comments submitted yet. Do you have an interesting opinion? Then be the first to post a comment.