We have created highly transparent and liquid futures and options markets that give participants the opportunity to trade and clear at low cost. Their value is reflected by record average daily volume in 2017 of 16.3 million contracts, up 4 percent from 2016. It is a testament to our unmatched product diversity, with volume records in interest rates, energy, agricultural commodities and metals. Additionally, we continue to be a leading exchange offering options on futures. In 2017, we reached new volume records in the total number of options contracts traded as well as the percentage of options that are traded electronically on our CME Globex platform.
We continued to evaluate regulatory developments while successfully executing our global growth strategy. Average daily volume increased 11 percent from Europe and 5 percent from Asia, outpacing our growth in North America. Significantly, open interest at the end of December was 108 million contracts, up 5 percent from the prior year end.
Clearing and transaction fee revenues for the year grew 2 percent despite historically low volatility and challenging comparisons due to the record volumes after the U.S. elections and Brexit vote in the prior year. At the same time, we kept expenses relatively flat by operating more efficiently. This helped create value for our shareholders. The company was able to declare an annual variable dividend of $1.2 billion based on 2017 performance, in addition to $894 million in quarterly dividends. In fact, we have returned more than $9.6 billion to shareholders in the form of dividends since implementing the variable dividend policy in early 2012.
“We have returned more than $9.6 billion to shareholders in the form of dividends since implementing the variable dividend policy in early 2012.”
We continued to build our position as a leading venue for trading the widest array of asset classes. This included strengthening the value proposition for our customers with new products and extensions. While our Ultra 10-Year U.S. Treasury Note futures contract continues to set records, we added FX Monthly futures, Wednesday Weekly FX options and Monday Weekly S&P 500 Index options in 2017.
We also further expanded our options business. There were record levels of contracts traded on our CME Globex platform, especially in energy and Eurodollar options. Total weekly options averaged a record 587,000 contracts per day in 2017, up 45 percent compared with 2016. The majority of our energy options are now traded electronically.
Surging U.S. oil production and exports further solidified the position of our WTI futures as a global benchmark. In agricultural commodities, we added financially settled futures contracts on Black Sea wheat and corn, and Australian wheat. They complement the growth of futures contracts on hard red winter wheat that we acquired through the Kansas City Board of Trade. Also, we expanded our base metals offering with a new Copper Premium Grade A CIF Shanghai futures contract that enables market participants to hedge their exposure to the China copper premium.
Energy, agricultural commodities and metals were the three fastest growing product lines with customers outside the United States. Their record levels helped us deliver outsized growth in Europe and Asia, accounting for approximately 25 percent of electronic volume. As part of our commitment to expanding opportunities in the Asia-Pacific region – where we have had an established presence for more than 30 years – we opened an office in Sydney, Australia, to serve this key financial center and commodities hub.
We also achieved record levels of open interest and a record total number of large open interest holders in multiple products in 2017, and broke those records again in early 2018.
We continued to broaden our business lines and saw record performance of our S&P joint venture with McGraw-Hill, which was up over 15 percent in 2017. Significantly, Russell 2000 futures and options contracts returned to CME Group. Now, traders are able to access more major equity indices on a single platform. As of December 31, 90 percent of open interest had moved to CME Group. The Russell products provide clients a more cost-effective opportunity for global exposure – with margin offsets of up to 70 percent against the S&P 500, Nasdaq and Dow Jones indices. We also saw strong client adoption of our Basis Trade at Index Close (BTIC) functionality on our equity index futures contracts.
We announced the launch of Japanese Yen-denominated Tokyo Stock Price Index (TOPIX) futures contracts. Adding the world’s fifth-largest equity index benchmark to our existing suite of Nikkei futures makes CME Group the only derivatives marketplace outside of Japan to offer futures contracts based on the two main Japanese equity indices. Further, given increasing client interest in evolving cryptocurrency markets, we seized the opportunity to launch a bitcoin futures contract in 2017. It is based on the CME CF Bitcoin Reference Rate, which tracks the U.S. dollar price of bitcoin.
In 2017, the Alternative Reference Rates Committee (ARRC) recommended that the broad Treasuries repo financing rate should serve as the reference rate in certain new U.S. dollar derivatives and other financial instruments. As a result, we began developing products on the Secured Overnight Financing Rate (SOFR), working with customers and the ARRC. These products will launch in 2018 after the new rate is published.
As customers continue to face additional pressures and uncertainty from regulatory reform, including Basel III implementation and uncleared margin rules, we are focused on providing enhanced services such as multilateral compression, which we offer in collaboration with TriOptima’s compression service.
We also expanded our OTC cleared product offering, in combination with portfolio margining across our OTC cleared and listed products. In the third quarter, we launched clearing for Korean won and Indian rupee interest rate swaps, expanding our global interest rate swap clearing solution to 21 currencies. This will provide better long-term liquidity – as well as counterparty, capital and operating efficiencies – to market participants who are looking for solutions in the cleared space.
In September 2017, we announced the launch of CME FX Link. It enables trading of an OTC spot FX contract with a CME Group FX futures contract via a single spread trade on the CME Globex trading platform. This facilitates efficient credit line management across both markets. Strengthening the integration between futures and the OTC FX marketplace will enhance access to CME Group’s deeply liquid and transparent FX futures market. In addition, last year we launched OTC FX options, and we plan to implement a portfolio margining program for customers trading both exchange-listed FX futures and cleared-only OTC FX swaps soon.
During 2018, we will exit the OTC credit default swap clearing business. This will free up approximately $600 million in clearing member capital and $50 million of CME Group capital.
Through enhancements to our CME Globex platform, we continue to offer clients match engine technology that is unparalleled in our industry. In addition to our traditional market data-by-price offering, we also completed implementation of market data by order – giving our clients greater transparency. We offer clients a variety of venues to access our products and services, including CME Direct and our CME One mobile platform, where we continue to expand and roll out new features.
We are focused on allocating our time and resources in the best possible way to drive long-term shareholder value. We closed our London-based exchange and clearing house, CME Europe and CME Clearing Europe, as our clients indicated they prefer our U.S. infrastructure to access our global products, deep liquidity and capital efficiencies. We also unlocked additional capital by selling stakes in BM&FBOVESPA and Bolsa Mexicana.
We believe there is tremendous opportunity to further enhance our offerings by applying advanced technologies throughout our business. As we invest in these initiatives, we can drive greater efficiencies and make our customers’ experience even more seamless.
While sharpening our operations, we continue to strategically reinvest in our business. We are contributing more resources to new product development as well as targeted sales and marketing campaigns, with the goal of expanding our client base and delivering growth. This approach is helping 2018 start off strong, and our team will continue to pursue the best opportunities available to benefit our customers and shareholders.
Terrence A. Duffy