Publications:
Quarterly Derivatives Fact Sheet - Third Quarter 1996

Revenues

The Call Report data include revenue information regarding cash and derivative derivative trading activities. The data also show the impact on net interest income and non-interest income from derivatives used in non-trading activities. Note that the revenue data reported in Table 7 reflect figures for the first quarter alone. The revenue figures reported for trading activities in the third quarter of 1996 indicate that the banks with derivatives realized approximately $1.7 billion from cash and off-balance sheet derivative contracts, with the top eight banks accounting for 84.1 percent of these trading revenues. Relative to the second quarter of, commercial banks reporting derivatives contracts in the third quarter of 1996 show an aggregate decrease in trading revenues from cash and derivatives activities of $182 million, or 9.5 percent. .

In the third quarter, revenues from interest rate contracts rose $39 million, to $990 million, while revenues from foreign exchange contracts decreased $218 million, to $514 million. Revenue from other trading contracts, including equities and commodities contracts, fell $3 million, generating $230 million in revenues; with virtually all of that amount was in the top eight 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 third quarter. Non-traded derivatives contributed $327 million, or .43 percent to the $76.1 billion in gross revenues of banks with derivative contracts in the third quarter. These figures reflect an increase of $97 million from the second quarter. 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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