Beijing's financial derivative market booming in 2007

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BEIJING, Sept 20 (CEIS): China's interest rate and exchange rate derivative market posted robust growth in first half of 2007, according to China Banking Regulatory Commission (CBRC).
In January-June 2007, RMB bond future products recorded 544 deals valued at 100.61 billion yuan, 36.7 per cent and 51.4 per cent higher over the whole 2006, respectively.
RMB interest rate swap deals amounted to 912 with a notional principal amount of 103.27 billion yuan in the first half of this year, up 8.9 times and 2.9 times over the whole of 2006, respectively.
By June-end, foreign banks traded 74.8 billion US dollars of transactions on OTC market, up 120 per cent year on year. The RMB interest rate swaps based on Shanghai inter-bank offered rate (SHIBOR) also undergone steady development.
During the period, 10.7 billion US dollars worth of forex future swap products were traded among banks with an average daily turnover of 90 million US dollars, 1.6 times that of 2006 average. The RMB/forex swaps transaction attained 133.4 billion US dollars of notional principal amount with an average daily turnover of 1.14 billion US dollars, 3.8 times that of 2006 average.
"As main participants of inter-bank financial market, banking institutions made great contributions to the development of derivative market," said Wang Huaqing, senior official of CBRC.
Wang also attributed the upbeat development to the improvement of risk management propelled by external risk events and CBRC as well as financial innovations.