Outstanding derivatives between UK banks and the country’s public sector almost halved in the first three months of the year, reversing the previous quarter’s spike.

Gross derivatives – assets plus liabilities – outstanding with public entities stood at £5.9 billion ($7.4 billion), 43% lower quarter-on-quarter. Yet this amount is still 62% greater than it was a year ago.

In contrast, UK banks’ swaps books with other UK entities expanded 18% to £66 billion on a gross basis and with other