Monthly Archives: March 2011

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NYT: FDIC to meet Tuesday on ‘skin in the game’

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The board of the Federal Deposit Insurance Corporation will meet Tuesday to discuss when trusts that sell asset-backed securities will have to retain some of the risk themselves, according to a March 27 column by Gretchen Morgenson in The New York … Continue reading

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Covered bonds could be the next U.S. repo collateral

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Covered bonds appear to be a candidate to replace asset-backed securities and asset-backed commercial paper as collateral for repo loans on the U.S. repurchase market, because they may be more acceptable to post-crisis investors. But covered bonds will not prevent … Continue reading

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Do repo and other risks still threaten the world economy?

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As regulators try to force commercial and investment banks to have more equity and less debt, by raising their capital requirements, the banks continue to find ways to evade the rules as they did leading up to the financial crisis … Continue reading

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Repo and derivative clearing houses concentrate the risk

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A critical look at post-crisis efforts by regulators to move privately negotiated, or over-the-counter, derivatives to clearinghouses to reduce systemic risk has unspoken lessons for the tri-party repo market as well. A March 2011 International Monetary Fund paper, “Making OTC Derivatives … Continue reading

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Could restricting short sales hurt repo market?

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European Union discussions to limit short selling, especially naked short selling, are meeting with objections from some of its member nations who fear the move would make it harder for them to raise money by selling debt on the repurchase … Continue reading

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FSA: Hedge funds rely on repos for funding

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A UK survey in September of just over 100 hedge funds shows the funds continued to rely more on repurchase agreements for funding than any other type of borrowing, but their total repo borrowing was down slightly from six months earlier. … Continue reading

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FDIC to charge higher premiums for repo use

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On April 1 banks will have to start paying Federal Deposit Insurance Corp. premiums on all types of debt including repurchase agreements, not just on domestic deposits. The switch “will be seismic at the nation’s largest banks, which in some … Continue reading