Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2014

Securities Owned and Securities Sold, But Not Yet Purchased at Fair Value



(Expressed in thousands)
	As of June 30, 2014				As of December 31, 2013
	Owned		Sold		Owned		Sold
U.S. Government, agency and sovereign obligations	$	642,125	$	72,327	$	596,114	$	11,889
Corporate debt and other obligations	23,791		477		14,673		4,847
Mortgage and other asset-backed securities	4,914		—		3,395		7
Municipal obligations	63,947		73		40,166		72
Convertible bonds	59,870		7,073		53,719		13,922
Corporate equities	54,629		46,116		61,634		45,336
Money markets	2,647		26		1,263		241
Auction rate securities	92,548		—		85,124		—
Total	$	944,471	$	126,092	$	856,088	$	76,314

Quantitative Information about Level 3 Fair Value Measurements

Additional information regarding the valuation technique and inputs for level 3 financial instruments used is as follows:



(Expressed in thousands)
Quantitative Information about Level 3 Fair Value Measurements at June 30, 2014
Product	Principal		Valuation Adjustment		Fair Value		Valuation Technique	Unobservable Input	Range	Weighted Average
Auction Rate Securities Owned ⁽¹⁾
Auction Rate Preferred Securities	$	78,850	$	4,059	$	74,791	Discounted Cash Flow	Discount Rate ⁽²⁾	1.37% to 1.86%	1.62%
								Duration	4.0 years	4.0 years
								Current Yield ⁽³⁾	0.13% to 0.43%	0.28%
Municipal Auction Rate Securities	10,030		958		9,072		Discounted Cash Flow	Discount Rate ⁽⁴⁾	2.51%	2.51%
								Duration	4.5 years	4.5 years
								Current Yield ⁽³⁾	0.24%	0.24%
	5,975		441		5,534		Secondary Market Trading Activity	Observable trades in inactive market for in portfolio securities	92.60% of par	92.60% of par
Student Loan Auction Rate Securities	900		92		808		Discounted Cash Flow	Discount Rate ⁽⁵⁾	3.33%	3.33%
								Duration	7.0 years	7.0 years
								Current Yield⁽³⁾	1.67%	1.67%
Other ⁽⁷⁾	3,625		1,282		2,343		Secondary Market Trading Activity	Observable trades in inactive market for in portfolio securities	64.60% of par	64.60% of par
	$	99,380	$	6,832	$	92,548
Auction Rate Securities Commitments to Purchase ⁽⁶⁾
Auction Rate Preferred Securities	$	9,033	$	443	$	8,590	Discounted Cash Flow	Discount Rate ⁽²⁾	1.37% to 1.86%	1.62%
								Duration	4.0 years	4.0 years
								Current Yield ⁽³⁾	0.17% to 0.43%	0.28%
Municipal Auction Rate Securities	10,653		1,017		9,636		Discounted Cash Flow	Discount Rate ⁽⁴⁾	2.51%	2.51%
								Duration	4.5 years	4.5 years
								Current Yield ⁽³⁾	0.24%	0.24%
Student Loan Auction Rate Securities	527		54		473		Discounted Cash Flow	Discount Rate ⁽⁵⁾	3.33%	3.33%
								Duration	7.0 years	7.0 years
								Current Yield ⁽³⁾	1.67%	1.67%
	$	20,213	$	1,514	$	18,699
Total	$	119,593	$	8,346	$	111,247


(1)	Principal amount represents the par value of the ARS and is included in securities owned in the condensed consolidated balance sheet at June 30, 2014. The valuation adjustment amount is included as a reduction to securities owned in the condensed consolidated balance sheet as well as principal transactions revenue in the statements of operations at June 30, 2014.

(2)Derived by applying a multiple to the spread between 110% to 150% to the U.S. Treasury rate of 1.24%.

(3)Based on current auctions in comparable securities that have not failed.

(4)Derived by applying a multiple to the spread of 175% to the U.S. Treasury rate of 1.43%.

(5)Derived by applying the sum of the spread of 1.20% to the U.S. Treasury rate of 2.13%.


(6)	Principal amount represents the present value of the ARS par value that the Company is committed to purchase at a future date. This principal amount is presented as an off-balance sheet item. The valuation adjustment amount is included in accounts payable and other liabilities on the condensed consolidated balance sheet at June 30, 2014.


(7)	Represents ARS issued by a credit default obligation structure that the Company has purchased and is committed to purchase as a result of a legal settlement.

Investments in Company-Sponsored Funds

The following table provides information about the Company’s investments in Company-sponsored funds at June 30, 2014:



(Expressed in thousands)
	Fair Value		Unfunded Commitments		Redemption Frequency	Redemption Notice Period
Hedge funds⁽¹⁾	$	1,324	$	—	Quarterly - Annually	30 - 120 Days
Private equity funds⁽²⁾	6,725		1,836		N/A	N/A
	$	8,049	$	1,836


(1)	Includes investments in hedge funds and hedge fund of funds that pursue long/short, event-driven, and activist strategies. Each hedge fund has various restrictions regarding redemption, no investment is locked-up for a period greater than one year.


(2)	Includes private equity funds and private equity fund of funds with a focus on diversified portfolios, real estate and global natural resources. Due to the illiquid nature of these funds, investors are not permitted to make withdrawals without consent of the general partner. The lock-up period of the private equity fund is expected to be 10 years.

Assets and Liabilities Measured at Fair Value on Recurring Basis

The Company’s assets and liabilities, recorded at fair value on a recurring basis as of June 30, 2014 and December 31, 2013, have been categorized based upon the above fair value hierarchy as follows:

Assets and liabilities measured at fair value on a recurring basis as of June 30, 2014



(Expressed in thousands)
	Fair Value Measurements at June 30, 2014
	Level 1		Level 2		Level 3		Total
Assets
Cash equivalents	$	28,364	$	—	$	—	$	28,364
Deposits with clearing organizations	16,091		—		—		16,091
Securities owned:							—
U.S Treasury securities	614,757		—		—		614,757
U.S. Agency securities	—		26,167		—		26,167
Sovereign obligations	—		1,201		—		1,201
Corporate debt and other obligations	—		23,791		—		23,791
Mortgage and other asset-backed securities	—		4,914		—		4,914
Municipal obligations	—		63,895		52		63,947
Convertible bonds	—		59,870		—		59,870
Corporate equities	54,629		—		—		54,629
Money markets	2,647		—		—		2,647
Auction rate securities	—		—		92,548		92,548
Securities owned, at fair value	672,033		179,838		92,600		944,471
Investments ⁽¹⁾	408		50,026		8,779		59,213
Loans held for sale	—		15,806		—		15,806
Securities purchased under agreements to resell ⁽²⁾	—		250,000		—		250,000
Derivative contracts:
TBAs	—		1,895		—		1,895
Interest rate lock commitments	—		—		10,528		10,528
Derivative contracts, total	—		1,895		10,528		12,423
Total	$	716,896	$	497,565	$	111,907	$	1,326,368
Liabilities
Securities sold, but not yet purchased:
U.S Treasury securities	$	71,693	$	—	$	—	$	71,693
U.S. Agency securities	—		35		—		35
Sovereign obligations	—		599		—		599
Corporate debt and other obligations	—		477		—		477
Municipal obligations	—		73		—		73
Convertible bonds	—		7,073		—		7,073
Corporate equities	46,116		—		—		46,116
Money markets	26		—		—		26
Securities sold, but not yet purchased at fair value	117,835		8,257		—		126,092
Investments	136		—		—		136
Derivative contracts:
U.S. treasury futures	188		—		—		188
Federal funds futures	—		43				43
Euro dollars futures	—		88		—		88
TBAs	—		181		—		181
Interest rate lock commitments	—		—		3,833		3,833
ARS purchase commitments	—		—		1,514		1,514
Derivative contracts, total	188		312		5,347		5,847
Total	$	118,159	$	8,569	$	5,347	$	132,075


(1)	Included in other assets on the condensed consolidated balance sheet.


(2)	Included in securities purchased under agreements to resell where the Company has elected fair value option treatment.

Assets and liabilities measured at fair value on a recurring basis as of December 31, 2013



(Expressed in thousands)
	Fair Value Measurements at December 31, 2013
	Level 1		Level 2		Level 3		Total
Assets
Cash equivalents	$	60,268	$	—	$	—	$	60,268
Securities segregated for regulatory and other purposes	11,495		—		—		11,495
Deposits with clearing organizations	10,492		—		—		10,492
Securities owned:
U.S Treasury securities	566,346		—		—		566,346
U.S. Agency securities	—		29,448		—		29,448
Sovereign obligations	—		320		—		320
Corporate debt and other obligations	—		14,673		—		14,673
Mortgage and other asset-backed securities	—		3,395		—		3,395
Municipal obligations	—		39,930		236		40,166
Convertible bonds	—		53,719		—		53,719
Corporate equities	61,634		—		—		61,634
Money markets	1,263		—		—		1,263
Auction rate securities	—		—		85,124		85,124
Securities owned, at fair value	629,243		141,485		85,360		856,088
Investments ⁽¹⁾	10,775		47,726		5,946		64,447
Loans held for sale	—		75,989		—		75,989
Securities purchased under agreements to resell ⁽²⁾	—		184,000		—		184,000
Derivative contracts:
TBAs	—		2,155		—		2,155
Interest rate lock commitments	—		—		2,375		2,375
Derivative contracts, total	—		2,155		2,375		4,530
Total	$	722,273	$	451,355	$	93,681	$	1,267,309
Liabilities
Securities sold, but not yet purchased:
U.S Treasury securities	$	11,837	$	—	$	—	$	11,837
U.S. Agency securities	—		52		—		52
Corporate debt and other obligations	—		4,847		—		4,847
Mortgage and other asset-backed securities	—		7		—		7
Municipal obligations	—		72		—		72
Convertible bonds	—		13,922		—		13,922
Corporate equities	45,336		—		—		45,336
Money markets	241		—		—		241
Securities sold, but not yet purchased at fair value	57,414		18,900		—		76,314
Investments	648		—		—		648
Derivative contracts:
U.S. treasury futures	186		—		—		186
Federal funds futures	—		18		—		18
Euro dollars futures	—		44		—		44
TBAs	—		73		—		73
Interest rate lock commitments	—		—		3,653		3,653
ARS purchase commitments	—		—		2,600		2,600
Derivative contracts, total	186		135		6,253		6,574
Total	$	58,248	$	19,035	$	6,253	$	83,536


(1)	Included in other assets on the condensed consolidated balance sheet.


(2)	Included in securities purchased under agreements to resell where the Company has elected fair value option treatment.

Changes in Level 3 Assets and Liabilities Measured at Fair Value on Recurring Basis

The following tables present changes in Level 3 assets and liabilities measured at fair value on a recurring basis for the three months ended June 30, 2014 and 2013:



(Expressed in thousands)
	Level 3 Assets and Liabilities
	For the Three Months Ended June 30, 2014
			Total Realized
			and Unrealized
	Beginning		Gains			Purchases		Sales and			Transfers		Ending
	Balance		(Losses) ⁽⁵⁾⁽⁶⁾			and Issuances ⁽⁷⁾		Settlements ⁽⁸⁾			In (Out)		Balance
Assets
Municipals	$	70	$	(18	)	$	—	$	—		$	—	$	52
Auction rate securities ⁽¹⁾	85,025		(327		)	10,975		(3,125		)	—		92,548
Interest rate lock commitments ⁽²⁾	3,038		7,490			—		—			—		10,528
Investments ⁽³⁾	8,706		82			115		(124		)	—		8,779
Liabilities
Interest rate lock commitments ⁽²⁾	4,402		569			—		—			—		3,833
ARS purchase commitments ⁽⁴⁾	2,205		691			—		—			—		1,514


(1)	Represents auction rate preferred securities, municipal auction rate securities and student loan auction rate securities that failed in the auction rate market.

(2)

Interest rate lock commitment is recorded upon the commitment to originate a loan with a borrower and sell the loan to an investor. This commitment asset and liability is recognized at fair value, which reflects the fair value of the contractual loan origination related fees and sale premiums, net of co-broker fees, and the estimated fair value of the expected net future cash flows associated with the servicing of the loan.


(3)	Primarily represents general partner ownership and limited partner interests in hedge funds and private equity funds sponsored by the Company.


(4)	Represents the difference in principal and fair value for auction rate securities purchase commitments outstanding at the end of the period.


(5)	Included in principal transactions on the condensed consolidated statement of operations, except for investments which are included in other income on the condensed consolidated statement of operations.


(6)	Unrealized gains (losses) are attributable to assets or liabilities that are still held at the reporting date.

(7)

Purchases and issuances in connection with ARS purchase commitments represent instances in which the Company purchased ARS securities from clients during the period pursuant to regulatory and legal settlements and awards that satisfy the outstanding commitment to purchase obligation. This also includes instances where the ARS issuer has redeemed ARS where the Company had an outstanding purchase commitment prior to the Company purchasing those ARS.


(8)	Sales and settlements for the ARS purchase commitments represent additional purchase commitments made during the period for regulatory and legal ARS settlements and awards.



(Expressed in thousands)
	Level 3 Assets and Liabilities
	For the Three Months Ended June 30, 2013
			Total Realized
			and Unrealized
	Beginning		Gains			Purchases		Sales and			Transfers			Ending
	Balance		(Losses) ⁽⁵⁾⁽⁶⁾			and Issuances ⁽⁷⁾		Settlements ⁽⁸⁾			In (Out)			Balance
Assets
Mortgage and other asset-backed securities⁽¹⁾	$	52	$	7		$	50	$	(36	)	$	(6	)	$	67
Municipals	239		(3		)	—		—			—			236
Auction rate securities ⁽²⁾	72,553		498			6,175		(1,150		)	—			78,076
Investments ⁽³⁾	12,779		—			292		2			(99		)	12,974
Liabilities
Auction rate securities ⁽²⁾	100		—			100		—			—			—
ARS purchase commitments ⁽⁴⁾	2,094		(235		)	—		—			—			2,329


(1)	Represents private placements of non-agency collateralized mortgage obligations.


(2)	Represents auction rate preferred securities, municipal auction rate securities and student loan auction rate securities that failed in the auction rate market.


(3)	Primarily represents general partner ownership interests in hedge funds and private equity funds sponsored by the Company.


(4)	Represents the difference in principal and fair value for auction rate securities purchase commitments outstanding at the end of the period.


(5)	Included in principal transactions on the condensed consolidated statement of operations, except for investments which are included in other income on the condensed consolidated statement of operations.


(6)	Unrealized gains (losses) are attributable to assets or liabilities that are still held at the reporting date.

(7)


(8)	Sales and settlements for the ARS purchase commitments represent additional purchase commitments made during the period for regulatory and legal ARS settlements and awards.

Assets and Liabilities Not Measured at Fair Value on Recurring Basis

Assets and liabilities not measured at fair value on a recurring basis as of June 30, 2014



(Expressed in thousands)
					Fair Value Measurement: Assets
	As of June 30, 2014				As of June 30, 2014
	Carrying Value		Fair Value		Level 1		Level 2		Level 3		Total
Cash	$	36,810	$	36,810	$	36,810	$	—	$	—	$	36,810
Cash segregated for regulatory and other purposes	19,117		19,117		19,117		—		—		19,117
Deposits with clearing organization	16,094		16,094		16,094		—		—		16,094
Receivable from brokers, dealers and clearing organizations
Securities borrowed	245,206		245,206		—		245,206		—		245,206
Receivables from brokers	23,086		23,086		—		23,086		—		23,086
Securities failed to deliver	51,432		51,432		—		51,432		—		51,432
Clearing organizations	22,820		22,820		—		22,820		—		22,820
Other	8,773		8,773		—		8,773		—		8,773
	351,317		351,317		—		351,317		—		351,317
Receivable from customers	951,015		951,015		—		951,015		—		951,015
Mortgage servicing rights (“MSRs”)	29,115		40,662		—		—		40,662		40,662
Escrow deposit⁽¹⁾	25,007		25,007		25,007		—		—		25,007


(1)	Included in other assets on the condensed consolidated balance sheet. Represents escrow monies deposited with a commercial bank. Corresponds with payable to third party in accounts payable and other liabilities on the condensed consolidated balance sheet (see note 3 below).



(Expressed in thousands)
					Fair Value Measurement: Liabilities
	As of June 30, 2014				As of June 30, 2014
	Carrying Value		Fair Value		Level 1		Level 2		Level 3		Total
Drafts payable	$	32,913	$	32,913	$	32,913	$	—	$	—	$	32,913
Bank call loans	147,200		147,200		147,200		—		—		147,200
Payables to brokers, dealers and clearing organizations
Securities loaned	203,585		203,585		—		203,585		—		203,585
Securities failed to receive	37,910		37,910		—		37,910		—		37,910
Clearing organizations and other	13,937		13,937		—		13,937		—		13,937
	255,432		255,432		—		255,432		—		255,432
Payables to customers	684,884		684,884		—		684,884		—		684,884
Securities sold under agreements to repurchase	816,606		816,606		—		816,606		—		816,606
Accounts payable and other liabilities
Warehouse payable ⁽²⁾	14,297		14,297		—		14,297		—		14,297
Payable to third party ⁽³⁾	25,007		25,007		25,007		—		—		25,007
Senior secured notes	150,000		160,125		—		160,125		—		160,125

(2)

Warehouse payable represents loans outstanding under a warehouse facility provided by a commercial bank but prior to GNMA securitization. The borrowing rate on the warehouse facility is based upon a variable interest rate of 1 month LIBOR plus a spread. The carrying amounts approximate fair value because of the short maturity of these instruments. Used to fund loans held for sale in other assets on the condensed consolidated balance sheet.


(3)	Corresponds with escrow deposit in other assets on the condensed consolidated balance sheet (see note 1 above).

Assets and liabilities not measured at fair value on a recurring basis as of December 31, 2013



(Expressed in thousands)
					Fair Value Measurement: Assets
	As of December 31, 2013				As of December 31, 2013
	Carrying Value		Fair Value		Level 1		Level 2		Level 3		Total
Cash	$	38,026	$	38,026	$	38,026	$	—	$	—	$	38,026
Cash segregated for regulatory and other purposes	24,828		24,828		24,828		—		—		24,828
Deposits with clearing organization	13,187		13,187		13,187		—		—		13,187
Receivable from brokers, dealers and clearing organizations
Deposits paid for securities borrowed	274,127		274,127		—		274,127		—		274,127
Receivables from brokers	49,803		49,803		—		49,803		—		49,803
Securities failed to deliver	9,628		9,628		—		9,628		—		9,628
Clearing organizations	27		27		—		27		—		27
Omnibus accounts	18,086		18,086		—		18,086		—		18,086
Other	13,202		13,202		—		13,202		—		13,202
	364,873		364,873		—		364,873		—		364,873
Receivable from customers	868,869		868,869		—		868,869		—		868,869
Securities purchased under agreements to resell	825		825		825		—		—		825
Mortgage servicing rights (“MSRs”)	28,879		40,084		—		—		40,084		40,084
Escrow deposit ⁽¹⁾	25,006		25,006		25,006		—		—		25,006


(1)	Included in other assets on the condensed consolidated balance sheet. Represents escrow monies deposited with a commercial bank. Corresponds with payable to third party in accounts payable and other liabilities on the condensed consolidated balance sheet (see note 3 below).



(Expressed in thousands)
					Fair Value Measurement: Liabilities
	As of December 31, 2013				As of December 31, 2013
	Carrying Value		Fair Value		Level 1		Level 2		Level 3		Total
Drafts payable	$	48,198	$	48,198	$	48,198	$	—	$	—	$	48,198
Bank call loans	118,200		118,200		118,200		—		—		118,200
Payables to brokers, dealers and clearing organizations
Deposits received for securities loaned	211,621		211,621		—		211,621		—		211,621
Securities failed to receive	5,346		5,346		—		5,346		—		5,346
Clearing organizations and other	6,348		6,348		—		6,348		—		6,348
	223,315		223,315		—		223,315		—		223,315
Payables to customers	626,564		626,564		—		626,564		—		626,564
Securities sold under agreements to repurchase	757,491		757,491		—		757,491		—		757,491
Accounts payable and other liabilities
Warehouse payable ⁽²⁾	54,614		54,614		—		54,614		—		54,614
Payable to third party ⁽³⁾	25,006		25,006		25,006		—		—		25,006
Senior secured notes	195,000		208,529		—		208,529		—		208,529

(2)


(3)	Corresponds with escrow deposit in other assets on the consolidated balance sheet (see note 1 above).

Notional Amounts and Fair Values of Derivatives by Product

The notional amounts and fair values of the Company’s derivatives at June 30, 2014 and December 31, 2013 by product were as follows:



(Expressed in thousands)
	Fair Value of Derivative Instruments at June 30, 2014
	Description	Notional		Fair Value
Assets:
Derivatives not designated as hedging instruments ⁽¹⁾
Other contracts	TBAs	$	44,515	$	144
	TBA sale contracts	239,078		1,750
	Interest rate lock commitments	170,715		10,528
		$	454,308	$	12,422
Liabilities:
Derivatives not designated as hedging instruments ⁽¹⁾
Commodity contracts ⁽²⁾	U.S. Treasury futures	$	80,000	$	188
	Federal funds futures	4,195,000		43
	Euro dollars futures	285,000		88
Other contracts	TBAs	34,412		181
	Interest rate lock commitments	49,182		3,833
	ARS purchase commitments ⁽³⁾	20,212		1,514
		$	4,663,806	$	5,847


(1)	See “Derivative Instruments and Hedging Activities” above for description of derivative financial instruments. Such derivative instruments are not subject to master netting agreements, thus the related amounts are not offset.


(2)	Included in payable to brokers, dealers and clearing organizations on the condensed consolidated balance sheet.


(3)	Included in accounts payable and other liabilities on the condensed consolidated balance sheet.



(Expressed in thousands)
	Fair Value of Derivative Instruments at December 31, 2013
	Description	Notional		Fair Value
Assets:
Derivatives not designated as hedging instruments ⁽¹⁾
Other contracts	TBAs	$	25,262	$	134
	TBA sale contracts	266,415		2,021
	Interest rate lock commitments	115,569		2,375
		$	407,246	$	4,530
Liabilities:
Derivatives not designated as hedging instruments ⁽¹⁾
Commodity contracts ⁽²⁾	U.S. Treasury futures	$	60,000	$	186
	Federal funds futures	6,155,000		18
	Euro dollars futures	347,000		44
Other contracts	TBAs	14,547		73
	Interest rate lock commitments	76,604		3,653
	Forward start repurchase agreements	506,000		—
	ARS purchase commitments ⁽³⁾	29,056		2,600
		$	7,188,207	$	6,574


(1)	See “Derivative Instruments and Hedging Activities” above for description of derivative financial instruments. Such derivative instruments are not subject to master netting agreements, thus the related amounts are not offset.


(2)	Included in payable to brokers, dealers and clearing organizations on the condensed consolidated balance sheet.


(3)	Included in accounts payable and other liabilities on the condensed consolidated balance sheet.

Fair Value Amounts of Derivative Instruments and their Effect on Statement of Operations

The following table presents the location and fair value amounts of the Company’s derivative instruments and their effect on the condensed consolidated statements of income for the three months ended June 30, 2014 and 2013:



(Expressed in thousands)
	The Effect of Derivative Instruments on the Statement of Operations
	For the Three Months Ended June 30, 2014
		Recognized in Income on Derivatives (pre-tax)
Types	Description	Location	Gain (Loss)
Commodity contracts	U.S. Treasury futures	Principal transaction revenue	$	(637	)
	Federal funds futures	Principal transaction revenue	7
	Euro dollars futures	Principal transaction revenue	(27		)
Other contracts	TBAs	Principal transaction revenue	(60		)
	TBAs sale contracts	Other	4,596
	Interest rate lock commitments	Other	8,059
	ARS purchase commitments	Principal transaction revenue	691
			$	12,629



(Expressed in thousands)
	The Effect of Derivative Instruments on the Statement of Operations
	For the Three Months Ended June 30, 2013
		Recognized in Income on Derivatives (pre-tax)
Types	Description	Location	Gain (Loss)
Commodity contracts	U.S. Treasury futures	Principal transaction revenue	$	921
	Federal funds futures	Principal transaction revenue	(107		)
Other contracts	TBAs	Principal transaction revenue	173
	TBA sale contracts	Other	692
	ARS purchase commitments	Principal transaction revenue	535
			$	2,214



(Expressed in thousands)
	The Effect of Derivative Instruments on the Statement of Operations
	For the Six Months Ended June 30, 2014
		Recognized in Income on Derivatives (pre-tax)
Types	Description	Location	Gain (Loss)
Commodity contracts	U.S. Treasury futures	Principal transaction revenue	$	(1,060	)
	Federal funds futures	Principal transaction revenue	(153		)
	Euro dollars futures	Principal transaction revenue	(116		)
Other contracts	TBAs	Principal transaction revenue	(24		)
	TBAs sale contracts	Other	(3,771		)
	Interest rate lock commitments	Other	7,973
	ARS purchase commitments	Principal transaction revenue	1,086
			$	3,935



(Expressed in thousands)
	The Effect of Derivative Instruments on the Statement of Operations
	For the Six Months Ended June 30, 2013
		Recognized in Income on Derivatives (pre-tax)
Types	Description	Location	Gain (Loss)
Commodity contracts	U.S. Treasury futures	Principal transaction revenue	$	801
	Federal funds futures	Principal transaction revenue	(52		)
	Euro dollars futures	Principal transaction revenue	72
Other contracts	TBAs	Principal transaction revenue	256
	TBA sale contracts	Other	592
	ARS purchase commitments	Principal transaction revenue	2,329
			$	3,998