Repo Transactions

If you have highly liquid securities in your assets (e.g., government bonds, treasury bills), you can pledge them to secure additional liquidity. These transactions are called repo transactions

Repo transactions deal:

  • in government bonds, 
  • treasury bills issued by the Ministry of Finance,
  • other company bonds or bank bonds. 

They are usually agreed for short maturity terms, but can it be longer, up to a year. The product enables a buyer to fulfil any possible need for liquid assets without selling securities.

How do Repo operations function?

The client provides high-liquidity securities (collateral) to the bank as collateral and receives cash funds in an equivalent currency on their account.

*If the securities are in Euros (), the cash funds will also be in euros.

Advantages of Repo Transactions:

  • You retain all rights to the securities for the duration of the contracted product term.
  • Short-term financing with the possibility of extension.

Risks of Repo Transactions:

  • Change in Collateral Value
  • Haircut – a defined percentage of the nominal value of collateral by which the amount of received funds is reduced.

Contacts

Need more information?

Contact us with full confidence, we will solve all your queries as soon as possible.

 

Find out more about related products