||Other Derivative Contracts - Swaps
This is a balancing item in the list in which it is being used.This is the value, as at the relevant date, of other swap derivative contracts, consistent with the classification and measurement basis used for derivatives by institutions in accordance with accounting standards.This balancing item represents total swap derivative contracts less those contracts which are classed as any of the following:- Interest rate contracts;- Foreign exchange contracts;- Gold contracts; or- Equity contracts.A Swap is a financial instrument representing a transaction in which two parties agree to swap or exchange some obligation, generally a series of cash flows on differing terms.Derivatives are generally defined as those instruments/contracts, where the value is based on other products, and/or on prices associated with financial products. Derivative contracts involve:- Future delivery, receipt or exchange of financial items such as cash or another derivative instrument; or- Future exchange of real assets for financial items where the contract may be tradeable and has a market value.The contracts can either be binding on both parties (e.g. as with a currency swap) or subject to the exercise by one party of a right contained within the contract (as with options).Report this item regardless of whether favourable or unfavourable to the reporting entity.
While not intended as an exhaustive list, other derivative contracts may include the following:
- purchased options;
- similar derivative contracts based on precious metals such as gold, silver, platinum and palladium;
- energy contracts;
- agricultural contracts;
- base metals (such as aluminium, copper and zinc);
- other non-precious metal commodity contracts; and
- any contracts covering other items, that give rise to credit risk.
Netting should not be applied when reporting amounts within the Statement of Derivative Activity.