Canada’s Department of Finance and the Bank of Canada are announcing the launch of securities lending of the government’s Canada Mortgage Bond (CMB) holdings, to support market well-functioning.
The government is making its CMB holdings available to borrow via CIBC Mellon/BNY’s pre-existing securities lending services, which uses a market-based pricing structure. CIBC Mellon/BNY was selected as agent based on a detailed evaluation of short-listed securities lending agents in the Canadian fixed-income market.
The government is making its full holdings of CMBs available, and the daily average amounts on loan over the prior month for each security will be published on the central bank’s website by the fifth business day of the following month.
The government will participate in all fixed-rate CMB syndications proposed for 2025 and will continue to target a total purchase amount of 50% of fixed-rate CMB primary issuances. The Bank of Canada will continue to conduct CMB purchases on the government’s behalf.