Core Insights - The report titled "2024 Annual Development Report of China's Over-the-Counter Financial Derivatives Market" was jointly released by the Trading Association, Foreign Exchange Trading Center, and Shanghai Clearing House, analyzing the development of domestic and foreign markets and annual hot issues for 2024 [1] - In 2024, under the guidance of the People's Bank of China and the State Administration of Foreign Exchange, the market for over-the-counter derivatives is expected to develop steadily, improve market services, ensure efficient and stable operation of infrastructure, and promote high-level market openness to better meet the risk management needs of market participants [1] Market Performance - The nominal principal of the interbank derivatives market reached 235.4 trillion yuan in 2024, representing a year-on-year growth of 19.7%, indicating stable growth in the derivatives market size [1] - The product series in the derivatives market continues to diversify, and the operational management mechanism is becoming more refined, enhancing market vitality [1] - The role of the derivatives market in strengthening risk management, promoting price discovery, and serving the real economy is becoming increasingly prominent [1] Future Outlook - The Trading Association, Foreign Exchange Trading Center, and Shanghai Clearing House will continue to enhance market service levels and advance the development and openness of the over-the-counter financial derivatives market to higher levels under the guidance of the People's Bank of China and the State Administration of Foreign Exchange [1]

Core Viewpoint - The China Securities Regulatory Commission (CSRC) has mandated securities firms to report on their off-exchange securities business for 2024, emphasizing compliance, risk management, and innovative profit models [1][2]. Group 1: Off-Exchange Business Reporting Requirements - Securities firms are required to provide detailed reports on six categories of off-exchange business, including financial derivatives trading, income certificate issuance, cross-border business, and more [1]. - Firms must disclose their business models, risk management measures, and actual profitability related to off-exchange derivatives trading [1][2]. - Specific attention is given to compliance management, including reporting major events such as defaults and significant business risks [1][2]. Group 2: Industry Trends and Developments - The off-exchange business has become a crucial driver for the high-quality transformation of securities firms, optimizing income structure and enhancing risk management [2][3]. - The securities industry achieved a revenue of 451.17 billion yuan in 2024, with a year-on-year growth of 11.2%, and proprietary business income grew by 43% [1][2]. - The shift towards customer-demand-driven business models has allowed firms to mitigate the impact of market volatility on overall profitability [3]. Group 3: Regulatory Focus and Market Impact - The CSRC's requirements reflect a regulatory focus on promoting standardization, preventing risks, and enhancing practical effectiveness in the industry [2]. - Off-exchange derivatives trading provides a differentiated business model that supports investor services and fulfills functional missions [3][4]. - The integration of off-exchange derivatives into the business ecosystem enhances the intermediary role of securities firms, aligning with their market development goals [4].