We're looking at the largest banking behemoths in the US in the following tables. These are the big boys. The concentrated exposure is striking, if not chilling. As you can see, interest rate contracts account for the bulk of derivatives activities. Citibank is a bit of a special case given it's global exposure.
Many people tend to think of derivatives as puts, calls and futures.
The banks aren't betting on the stock market. Far from it. Interest rate contracts and credit derivatives are essential to their lending activities and those of their clients. Their contribution to credit creation. Time to make some more loans, of course.