The size of the credit default swaps market shrank by almost a fifth in terms of notional outstanding contracts this year as infrastructure developments allowed banks and other investors to net off contracts more effectively and tidy up their trading books.

While the overall trading volumes in the CDS market have surged dramatically in recent months, banks have been able to manage their risks better by terminating unnecessary contracts on their books, according to TriOptima, a Sweden-based technology company that manages terminations.