repurchase agreement

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Related to Repo agreement: Repo transaction

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.

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 ?
The GSCC filing made clear that, if a GSCC repo netting participant provided for a right of substitution in the underlying repo agreement, there was no need for that participant to seek to enter into an additional agreement with GSCC regarding that right of substitution.
France-based Natixis SA (EPA: KN) and Societe Generale (SOGN.PA) have completed a pilot project to enhance the operational efficiency of repo agreements.
In March 2012, FASB therefore announced plans to revise the repo agreement standards.
A repo agreement typically involves the transfer of securities in exchange for cash.
Two important elements of the repo agreement are negotiating which securities can be posted as collateral and negotiating the total value of securities to be posted as collateral.
The leu declined after the central bank lifted a limit on the size of its repo agreement auctions.
The program could be used to buyback shares currently pledged under the repo agreement with Sberbank, which could create additional support for the share prices.
To establish a tri-party trading relationship, a cash provider and a cash borrower execute a master repo agreement (MRA) that stipulates the key elements of their prospective tri-party repos, such as how a repo may be terminated and how margins will be maintained.
In 2007, BNY Mellon was selected to serve as collateral agent for the first domestic JGBs tri-party repo agreement in Japan.