Survey of Foreign Exchange and Derivatives Market Activity in Lithuania in 2013

The objective of the survey is to obtain reasonably comprehensive and internationally consistent information on the size and structure of foreign exchange and over-the-counter (OTC) derivatives markets. This year's survey of foreign exchange and derivatives markets differs from the previous surveys in that a more detailed level of identification is required (other financial institutions are divided into several subsectors, more currency pairs are involved); it was also aimed to single out those transactions where a bank acts as a prime-broker between a customer and a third party (bank).

The global survey conducted in 2013 covers the data of traditional foreign exchange market transactions (spots, forwards and swaps) and OTC derivatives transactions collected from approximately 1300 major global market participants. In Lithuania, six banks and subsidiaries of foreign banks participated in the survey, which hold up to 95 per cent of the country's foreign exchange and financial derivatives market. The data covers transactions conducted in April.

Lithuania's foreign exchange market has more than halved over the last three years. In April 2013, Lithuania's foreign exchange market turnover made USD 11.1 billion (average daily business of USD 0.5 billion). Foreign exchange swap transactions accounted for 68 per cent and spot transactions for 32 per cent of monthly turnover (see Table 1).

Lithuania's foreign exchange market participants revealed that the largest number of transactions was carried out with the reporting banks (72%), of which mainly with non-resident banks (73%). Meanwhile, transactions with other financial and non-financial institutions accounted for 3 and 25 per cent respectively.

Although euro denominated transactions prevail in Lithuania's foreign exchange market, the transactions made using financial derivatives with litas among other currencies accounted for 80 per cent (see Table 2). The dominant pair of euro and dollar, non-Lithuania currencies, was used in 12 per cent of transactions.

No other financial derivative transactions (currency swaps, single-currency interest rate derivatives) were conducted in April 2013.

Preliminary data of the survey of global foreign exchange and derivatives market are available on the website of the BIS, which also includes data collected by the Bank of Lithuania.

Table 1. Lithuania’s foreign exchange and derivatives market turnover by instrument, counterparty and maturity (Nominal or notional principal amounts in April; in millions of US dollars)