New CSA rules drag certain index credit default swaps into Canada's mandatory clearing net for the first time
Canada's OTC derivatives market climbed 12.2% to CAD $121 trillion in 2025, and certain index credit default swaps now sit inside Canada's mandatory clearing framework for the first time.
The Ontario Securities Commission (OSC) released its Canadian OTC Derivatives 2025 Annual Report on May 21, 2026. The Report pulls publicly available data into one place to give investors and market participants a clearer read on Canada's OTC derivatives markets in 2025. Exchange-traded derivatives sit outside the scope, so every figure below refers only to OTC activity.
Gross notional outstanding (GNO) in Canada's OTC derivatives market rose from CAD $108 trillion in the fourth quarter of 2024 to CAD $121 trillion in the fourth quarter of 2025 — a 12.2% jump. Interest rate derivatives did most of the heavy lifting, with their GNO growing 15.5% from CAD $92 trillion to CAD $106 trillion over the same period.
The Report leans on Bank for International Settlements (BIS) data to put Canada in a global frame. Global OTC derivatives GNO hit a record CAD $1,145 trillion in June 2025, a 15.2% year-over-year increase. Canada's slice of that pie, however, shrank from 10.8% in June 2024 to 9.2% in June 2025. The drop tracked a contraction in Canadian interest rate derivatives, whose GNO slipped from CAD $94 trillion to CAD $90 trillion, even as the global interest rate market expanded from CAD $791 trillion to CAD $906 trillion.
Canada still punches above its weight in two asset classes. As of June 2025, Canadian equity and interest rate derivatives accounted for 11.8% and 10.0% of global GNO in their respective markets. Domestically, interest rate derivatives remained the dominant asset class at 88.2% of total GNO in the fourth quarter of 2025. Currency derivatives slipped to 9.0%. Credit and equity derivatives sat at roughly 1.0% and 1.4%, while commodity derivatives — newly captured in public reporting — came in at 0.4%.
That commodity slice is itself a story. The Report notes that publicly available trade repository data began including commodity derivatives GNO in July 2025, adding CAD $519 billion to total OTC derivatives GNO by the fourth quarter of 2025.
Regulatory amendments reshape reporting and clearing
The Report walks through several regulatory developments that landed during the year.
Amendments to OSC Rule 91-507 (Derivatives: Trade Reporting) took effect on July 25, 2025. They tightened data standardization, sharpened product classification, and lifted the overall quality of OTC derivatives reporting. The Report flags that these amendments, together with compliance-related remediation, influenced 2025 statistics for outstanding positions, average trade size, and new transaction counts.
Updated OSC trade repository designation orders, issued in July 2025, expanded publicly available Canadian aggregates by requiring publication of GNO for the commodity asset class. That is how commodity GNO became publicly visible in 2025.
The bigger structural shift came from the Canadian Securities Administrators (CSA). Amendments to National Instrument 94-101 (Mandatory Central Counterparty Clearing of Derivatives) were published in September 2025 and came into effect on March 25, 2026. They refreshed the list of mandatory clearable interest rate derivatives to reflect benchmark transitions and stretched the clearing perimeter to include certain index credit default swap (CDS) products.
Those updates reflect the move to risk-free interest rate benchmarks such as the Canadian Overnight Repo Rate Average (CORRA) and the Secured Overnight Financing Rate (SOFR), after the wind-down of legacy benchmarks including the Canadian Dollar Offered Rate (CDOR) and the London Interbank Offered Rate (LIBOR). The amendments also brought CDS referencing certain indices into scope. As the Report puts it, this marked the first time credit derivatives have been formally included in Canada's mandatory clearing framework.
Compliance reviews and data quality
The Report is candid about the role compliance work played in reshaping the numbers. Shifts in outstanding positions and average trade size across asset classes in 2025 were heavily influenced by compliance-related data quality remediation and the July 25, 2025 trade reporting amendments. Together, they improved standardization, classification, and comparability across asset classes.
During those examinations, OSC Staff flagged many stale or expired contracts for differences (CFDs) and other transactions still sitting on the books as active. Those positions were terminated as part of a data-quality remediation effort. The Report ties the cleanup to substantial reductions in outstanding equity, currency, and commodity positions in Canada during 2025, and to increases in average transaction size — most visibly in currency and equity derivatives.
Market composition and clearing rates
Interest rate derivatives held the largest share of Canada's OTC derivatives market by GNO. Between the fourth quarter of 2024 and the fourth quarter of 2025, that share moved from 85.6% to 88.2%. Currency derivatives slid from 12.2% to 9.0%. Credit derivatives nudged up from 0.8% to 1.0%. Equity derivatives held steady at 1.4%, and commodity derivatives landed at 0.4% in the fourth quarter of 2025.
On the clearing front, 95.7% of Canada's interest rate derivatives, measured by GNO, were centrally cleared as of the fourth quarter of 2025. That figure has stayed between 90.0% and 96.0% for three years running. In the same quarter, 51.3% of credit derivatives were centrally cleared — a number now poised to evolve under the new mandatory clearing perimeter.
The OSC said it will continue its efforts to make this data available to investors and other market participants. The full text of the Canadian OTC Derivatives 2025 Annual Report is available at https://www.osc.ca/sites/default/files/2026-05/20260521-report-on-canadian-derivatives-2025.pdf.
