Publications:
Quarterly Derivatives Fact Sheet - First Quarter 1996
Choose Section: General.......Risk....Revenue........High-risk Mortgage Securities and Structured Notes
Revenues
The Call Report data include revenue information regarding cash and derivative trading
activities. The data also show the impact on net interest income and non-interest income from
non-trading activities. Note that the revenue data reported in Table 7 and Graph 6 reflect figures
for the first quarter alone.
Relative to the fourth quarter of 1995, the first quarter of 1996 resulted in a increase in trading
revenues from cash and derivatives activities of $413 million, or 26.4 percent, totaling $1.9 billion in
the first quarter, with the top nine banks accounting for 86 percent of that amount. In the first quarter,
revenues from interest rate contracts rose $280 million to $1.2 billion, while revenues from
foreign exchange contracts increased $37 million, to $628 million. Revenue from other trading
contracts, including equities and commodities contracts, rose $96 million, generating $191
million in revenues; virtually all of that amount was in the top nine banks. [See Table 7.]
Derivatives held for purposes other than trading did not have a significant impact on either net
interest income or non-interest income in the first quarter. Non-traded derivatives contributed
$499 million, or .67 percent to the $75 billion in gross revenues of banks with derivative contracts in
the first quarter. These figures reflect a decline of $10 million from the fourth quarter (fourth
quarter contributed $509 million to gross revenues). Readers must be cautioned that these results
are only useful in the context of a more complete analysis of each bank's asset/liability structure
and management process.
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High-risk Mortgage Securities and Structured Notes
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