repurchase agreement

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Related to Repo transaction: repo rate

Repurchase agreement

An agreement with a commitment by the seller (dealer) to buy a security back from the purchaser (customer) at a specified price at a designated future date. Also called a repo, it represents a collateralized short-term loan for which, where the collateral may be a Treasury security, money market instrument, federal agency security, or mortgage-backed security. From the purchaser's (customer's) perspective, the deal is reported as a reverse repo.


A practice in which a bank or other financial institution buys securities with the proviso that the seller must repurchase the same securities for an agreed-upon price on a certain day. Investors and financial institutions do this in order to raise short-term capital. A repo is also called a repurchase agreement or an overnight repo.

repurchase agreement (RP)

The sale of an asset at the same time an agreement is made to repurchase the asset at a specified price on a given date. Essentially, this process involves taking out a loan and using the asset as collateral. Also called repo. Compare reverse repurchase agreement. See also overnight repo.

repurchase agreement

An agreement to buy something back from the purchaser.This is encountered most often in two situations:(1) The thing purchased turns out to be less valuable than originally thought, such as when someone buys a promissory note, or a partial interest in a promissory note,and the obligor then defaults.(2) Especially with condominium units in facilities specializing in elder care, the seller of the units will agree to buy them back at a preestablished price if the owner dies or becomes so disabled as to require nursing home or similar care.

References in periodicals archive ?
8) A bilateral repo transaction is one in which there are only two parties to the transaction.
The securities obtained by the dealer in this process can then be rehypothecated in other repo transactions, if the collateral provider allows it.
A CCP would provide insurance against collateral risk and ensure settlement associated with the repo transaction.
However, an indication of its growth is the growth in the balance sheets of the institutions that play the role of banks in repo transactions as depicted in figure 2.
For concreteness, the discussion will refer to the two counterparties as the dealer and the customer even though a substantial fraction of repo transactions are among dealers themselves or between dealers and the Fed.
However, the available evidence suggests that the level and sensitivity of haircuts depend on the kind of repo transaction being considered.
Repo transactions have two parties: essentially the bank (or borrower) and another party, the depositor (or lender).
In contrast, a repo transaction typically starts on the trade date.
They cover almost the entire repo market because every repo transaction has a dealer on one side of it.
This information, detailed on SEC Form N-MFP, provides thorough disclosure of MMF asset composition and risk profiles and represents the most granular, publicly available data source on tri-party repo transaction attributes (e.
This accounting treatment contrasts with an ordinary repo transaction, which increases both assets and liabilities.
the turnover at the market are being importantly raised by a member of the Board, Chief Investment Director of PASHA Bank OJSC, repo transactions with corporate bonds (the first repo transaction was conducted in the trade system of Baku Stock Exchange on February 27).