WASHINGTON: Trading revenue of U.S. banks shot up 20 percent in the third quarter from the same period in 2015, to $6.4 billion, even though it edged down nearly 9 percent from the previous quarter, the Office of the Comptroller of the Currency reported on Wednesday. The OCC said that was the second highest level for the quarter since 2000.
Meanwhile, credit exposure from derivatives decreased $24 billion, or 4.7 percent, from the previous quarter, and the notional amount of derivatives held by insured banks shrank $12.4 trillion, or nearly 6.5 percent. The OCC said banks are compressing large numbers of similar swap contracts into fewer trades, leading to the drop.
Only 39 percent of all banks’ derivatives transactions in the quarter were centrally cleared, according to the OCC.
