Finally, the BSP chief pointed out that the Money Market Association of the Philippines-a private organization of bank treasurers and traders-volunteered to take the lead in developing the local repo
said earlier that they will launch the repo
facility which will increase bank reserves - on November 27.
agreement typically involves the transfer of securities in exchange for cash.
Section 4 provides the results of the empirical model for overnight repo
John Edwards, Managing Director of BrokerTec Europe, said: Following the Bank of Englands working group on a Sterling Risk-Free Reference Rate in the fixed income markets, customers are increasingly looking for an effective measure of the cost of funding in the Sterling repo
are used for funding, which is the more usual case, industry practice is for the value of collateral to exceed the amount of cash.
Total collateral value in the tri-party repo
market rose steeply after 2011, peaked toward the end of 2012, and then fell steeply.
on a specific bond allow traders to take a 'short' position in that bond.
MF Global, the global financial firm that filed for bankruptcy in October, is just the most recent noteworthy example of how repo
lending can go wrong.
The infrastructure that made tri-party repos
attractive to investors seems to have made it less convenient for them to adjust collateral haircuts on a per-transaction basis.
To obtain the leverage impact desired, Lehman had to account for these repos
105 transactions and use the borrowed funds to pay off another liability.
The dealer repos
out the specific collateral (borrows p at rate R) and simultaneously reverses in general collateral of the same value (lends p at rate r).