Derivatives

9 Months Ended

Sep. 30, 2012

Derivatives

Derivatives

9.Derivatives

The Company utilizes derivatives for trading strategies and economic hedging strategies to actively manage its market and liquidity exposures.  In addition, the Company enters into mortgage loan IRLCs in connection with its mortgage lending activities.  The following table summarizes the Company’s derivative instruments as of September 30, 2012 and December 31, 2011:

	September 30, 2012						December 31, 2011
(In thousands of dollars)	Number of Contracts	Notional		Fair Value			Number of Contracts	Notional		Fair Value
Purchase Contracts
TBA purchase agreements	15	$	201,579	$	561		1	$	589	$	—
Eurodollar futures contracts	—	—		—			—	—		—
IRLCs	901	157,008		2,953			708	127,227		1,696
Total	916	358,587		$	3,514		709	$	127,816	$	1,696
Sale Contracts
TBA sale agreements	31	$	785,423	$	(4,957	)	17	$	371,000	$	(1,183	)
Forward sale agreements	3	25,000		(141		)	11	120,900		(788		)
Eurodollar futures contracts	80	80,000		—			—	—		—
Total	114	$	890,423	$	(5,098	)	28	$	491,900	$	(1,971	)

Total gains/(losses) associated with these activities, which are recorded within Principal transactions within the Consolidated Statements of Operations were ($6.3) million and ($4.4) million, for the three months ended September 30, 2012 and 2011, respectively, and ($12.8) million and ($17.4) million, for the nine months ended September 30, 2012 and 2011, respectively.