Japan OTC derivatives post gains

The notional value of outstanding over-the-counter (OTC)derivatives contracts in Japan increased by 10.8% in the six months to June 2002, according to figures released by the Bank of Japan.

The notional amount of outstanding OTC contracts reached $13.3 trillion in June, compared with $12 trillion in December last year, the central bank said. Meanwhile, the outstanding value of exchange-traded derivatives contracts increased to $6.8 trillion, a rise of 2.2% over the December 2001 figures.

Of the OTC contracts, single-currency interest rate related contracts grew to $11.4 trillion – an increase of 12.4% over December 2001 figures – while foreign exchange-related contracts increased by 2.2% to $1.9 trillion. Credit derivatives contracts, however, decreased by 6.1% over the same period to $16.4 billion.

Interest rate swaps were by far the most popular instrument type, accounting for 77.1% of the total OTC figure. Foreign exchange swaps and forwards made up 8.3% of the total.