The nominal or face amount that is used to calculate payments made on swaps and other risk management products. This amount generally does not change hands and is thus referred to as "notional."
The amount of principal underlying an interest rate exchange agreement, and upon which is based the calculation of payments.
The amount considered as principal when calculating interest and other payments for derivative contracts. This amount traditionally does not change hands under the terms of a derivative contract.
The face amount of a transaction typically used as the basis for interest payment calculations. For swaps, this amount is not itself a cash flow. Credit exposure arises not against the notional but against the present value (market replacement cost) of in-the-money future terminal payment(s).
The amount of a derivative instrument on which interest or other payments are determined. The notional amount is not recorded on the balance sheet.
The amount (in an interest rate swap, forward rate agreement, or other derivative instrument) or each of the amounts (in a currency swap) to which interest rates are applied (whether or not expressed as a rate or stated on a coupon basis) in order to calculate periodic payment obligations. Also called the notional principal amount, the contract amount, the reference amount, and the currency amount.
Nominal or notional amounts outstanding are defined as the gross nominal or notional value of all deals concluded and not yet settled on the reporting date. For contracts with variable nominal or notional principal amounts, the basis for reporting is the nominal or notional principal amounts at the time of reporting.