rehypothecate


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Related to rehypothecate: hypothecated

Rehypothecate

To pledge securities as collateral for a loan when the same securities have already been pledged for another loan. Generally speaking, a brokerage rehypothecates when it needs to secure a loan for a client. That is, the client pledges securities for a loan on a margin account and the brokerage uses those same securities to procure a loan from a bank to finance the loan for the client.

rehypothecate

To repledge stock as collateral for a loan. In practice, this term means to pledge securities (by a brokerage firm) for a bank loan when the securities have already been pledged to the firm by one of its customers. The brokerage firm essentially passes along the collateral in order to obtain a loan to finance the customer's account.
References in periodicals archive ?
Further, GCF Repo is settled before triparty repo, allowing dealers to easily rehypothecate collateral obtained from GCF Repo into tri-party repo--in other words, reuse it for their own borrowing.
broker-dealer, (50) the broker-dealer may rehypothecate such securities
rehypothecate customer margin securities to a third party.
This ability to rehypothecate collateral allows them to "internalize" their sources of collateral and cash, finding uses for them among their other customers, or for their own trading.
dealer banks are particularly large prime brokers and are not bound by SEC rules 15c3-3, allowing them to rehypothecate securities to a larger extent than their U.S.
directly rehypothecate the customers' securities as collateral for