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Towards a monitoring framework for securities financing transactions

Author

Listed:
  • Bouveret, Antoine
  • Jardelot, Julien
  • Keller, Joachim
  • Molitor, Philippe
  • Thea, John
  • Vital, Mathieu

Abstract

Supervisory authorities around the world are currently engaged in a policy debate over how to improve the information available on repurchase agreements (repos) and securities lending markets. Repo and securities lending transactions commonly referred to as securities financing transactions (SFTs), play a major role in the financial system. Although these can be relatively low-risk transactions by themselves, their pervasive use may give rise to systemic risk, as was observed during the recent financial crisis. In order to establish and implement a monitoring framework that allows for an effective assessment of the financial stability risks associated with SFTs, a number of considerable hurdles must be overcome and important decisions must be made. One contribution of this paper is to identify the potential obstacles and difficulties that may hinder the implementation of a monitoring framework in Europe. JEL Classification: E44, G18

Suggested Citation

  • Bouveret, Antoine & Jardelot, Julien & Keller, Joachim & Molitor, Philippe & Thea, John & Vital, Mathieu, 2013. "Towards a monitoring framework for securities financing transactions," ESRB Occasional Paper Series 2, European Systemic Risk Board.
    • Handle: RePEc:srk:srkops:20132
    Note: 521888
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    References listed on IDEAS

    as
    1. Adrian, Tobias & Shin, Hyun Song, 2010. "Liquidity and leverage," Journal of Financial Intermediation, Elsevier, vol. 19(3), pages 418-437, July.
    2. Adam Copeland & Antoine Martin & Michael Walker, 2014. "Repo Runs: Evidence from the Tri-Party Repo Market," Journal of Finance, American Finance Association, vol. 69(6), pages 2343-2380, December.
    Full references (including those not matched with items on IDEAS)

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    JEL classification:

    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation

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