repurchase agreement

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Related to repurchase agreement: repo rate, Reverse Repurchase Agreement

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 ?
Reclassification of amortization of net deferred losses on de-designated interest rate swaps to repurchase agreements interest expense
Most banks took this opportunity to review their master repurchase agreement and ensure that the language transfers control of sold securities to the buyer.
The proceeds generated from the sale of the GICs are held in cash or invested in repurchase agreements and are accompanied by balance guarantee swaps provided by UniCredit Bank AG (UniCredit) pursuant to Hedge Agreements.
Investors have raised concerns that current accounting and disclosures for repurchase agreements do not appropriately reflect the transferor's obligations and risks resulting from those transactions in certain circumstances," stated FASB Chairman Leslie F.
Proceeds from the unwind of existing repurchase agreement transactions, along with $332 million of existing liquid investments held with BONY, are expected to be invested in overnight deposits with BONY until there is greater clarity with respect to the Pallas' near-term repayment obligations.
Under the Share Repurchase Agreement, Rambus will pre-pay to JP Morgan the $90 million purchase price for common stock and JP Morgan will deliver to Rambus a number of shares of its common stock.
announced today that it has signed an accelerated share repurchase agreement with Citigroup for the repurchase of 52.
6 million of thirty-day repurchase agreement financing at a rate of 1.
The preliminary ratings are based the adequate level of subordination underneath each class of notes; the amount of "excess spread" injected in the transaction by KBC Bank NV (KBC; single-'A'-plus/Stable/'A-1') through swap counterparty payments; the sound mechanics of the repurchase agreement and the credit default swap; the characteristics of the securities of the Kingdom of Belgium (double'A'-plus/Stable/'A-1'-plus) as collateral; and the sound legal structure of the transaction.
For example, a combined financial instrument created by selling a government security short and borrowing the security under a reverse repurchase agreement with a term approaching the maturity of the underlying government security would create contractual cash flows that may measure the value of the combined financial instrument.
For instance, the market value of the securities that the Fund is obligated to repurchase under a reverse repurchase agreement may decline below the repurchase price and the securities may not be returned to the Fund.
Repurchase agreement transactions entered into by the funds may be conducted through joint acccounts with other funds managed by FMR.