For
Immediate Release Wednesday, September 25, 2002
For More
Information, Please Contact:
Stacy Carey,
ISDA New York, (212) 901-6000; Fax (212) 901-6011; scarey@isda.org
“All
swaps in the Survey grew significantly in the first half of 2002, but the
growth in credit derivatives exceeded all expectations,” said Keith Bailey,
Chairman of the Board of ISDA. “The strong increase in credit swaps is good
news both for market participants and for financial markets as a whole,"
said Bailey. "Individual market participants are taking advantage of the
availability of credit protection, and financial markets are benefiting by
spreading credit risks over a wider and deeper market."
Interest rate and currency derivatives, which
consist of interest rate swaps and options and currency swaps, increased over
19% since ISDA’s Year-end Survey in December. Among firms responding to both the Year-End
and Mid-Year Surveys for interest rate and currency derivatives, outstandings grew 16%; and among the top ten reporting
dealers, outstandings grew nearly 18%. Credit
derivatives, which consist of credit default swaps, grew 44% since the end of
2001; among firms responding to both the 2001 Year-End and the 2002 Mid-Year
Surveys, outstandings grew 35%. Equity derivatives, which consist of equity
forwards, swaps, and options, are the newest addition
to the Market Survey.
ISDA surveys its Primary Membership twice yearly and the Market Survey
is performed on a confidential basis. All notional principal outstanding
amounts have been adjusted for double-counting of interdealer
transactions; in addition, some growth in the results comes from growth in the
number of firms responding. In this
Survey, 84 firms provided data on interest rate and currency swaps; 77 on
credit default swaps, and 76 on equity swaps. The ISDA numbers complement the
more comprehensive surveys published periodically by the Bank for International
Settlements (www.bis.org). For further
detail on the ISDA Market Survey methodology, please see www.isda.org/statistics/index.html
ISDA
is the global trade association representing leading participants in the
privately negotiated derivatives industry. ISDA was chartered in 1985, and
today has more than 580 member institutions
from 42 countries on six continents. These members include most of the
world's major institutions that deal in privately negotiated derivatives, as
well as many of the businesses, governmental entities and other end users that
rely on over-the-counter derivatives to manage efficiently the financial market
risks inherent in their core economic activities. Information about ISDA and
its activities is available on the Association's web site: www.isda.org.
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