BIS offers insight on OTC derivatives market , Contraction for 2H14

The Bank for International Settlements (BIS) today released OTC derivatives statistics at end-December 2014.

  • OTC derivatives markets contracted in the second half of 2014. The notional amount of outstanding contracts fell by 9% between end-June 2014 and end-December 2014, from $692 trillion to $630 trillion. Exchange rate movements exaggerated the contraction of positions denominated in currencies other than the US dollar. Yet, even after adjusting for exchange rate movements, notional amounts were still down by about 3%.
  • The gross market value of outstanding derivatives contracts – which provide a more meaningful measure of amounts at risk than notional amounts – rose sharply in the second half of 2014. Market values increased from $17 trillion to $21 trillion between end-June 2014 and end-December 2014, to their highest level since 2012. The increase was likely driven by pronounced moves in long-term interest rates and exchange rates during the period.
  • Central clearing, a key element in global regulators’ agenda for reforming OTC derivatives markets to reduce systemic risks, made further inroads. In credit default swap markets, the share of outstanding contracts cleared through central counterparties rose from 27% to 29% in the second half of 2014. In interest rate derivatives markets too, central clearing is becoming increasingly important.

Developments in the latest OTC derivatives statistics, including tables with the latest data, are summarised in the statistical release. Additional details and historical data are available on the BIS website. OTC derivatives statistics at end-June 2015 will be released on or before 15 November 2015.

Queries regarding the OTC derivatives statistics may be directed to statistics$bis.org (where “$” denotes “@”).

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The Association of International Wealth Management of India (AIWMI) is a not-for-profit organization and a globally recognized membership association for finance professionals. AIWMI primarily focuses on the broad and strategic role of developing a more robust and forward-looking training infrastructure for the financial services sector and to promote more active industry involvement and collaboration in training and continuing education. AIWMI is offering advanced international certification programs along with a wide variety of high-quality executive education programs. AIWMI programs combine state-of-the-art knowledge and skills with practical experience and insights into the functioning of the financial sector. All AIWMI courses and educational events have an intense and pragmatic curriculum. Participants are exposed to the latest developments within the financial services sector. AIWMI plays a key role in guiding the development of the financial services sector. AIWMI works with key industry participants’ viz. the Government, the Regulators, the Industries/Associations, the Corporate, the Media and the General Public to achieve its objectives. Besides enhancing technical competence and professionalism in the industry, AIWMI organizes events and facilitates discussions to promote best practices in leadership and talent development in the financial sector with an aim to become Asia’s premier center of excellence for financial education.

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