EU Said to Weigh Curbs on Collateral Asset Reuse in Repos
Banks and brokers may face European Union curbs on the number of times a single asset can be passed on as collateral in repurchase agreements and other secured trades, according to a person familiar with the plans.
The EU is weighing whether it should limit the length of transaction chains in which traders who receive collateral in turn use the same securities to back separate trades, according to the person, who asked not to be named because the proposals aren’t public. It is also planning measures to make the chains easier to monitor by regulators.
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