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Why would you forgo interest on something you pledge as collateral?

If it's because the actual mechanics take the form of a repurchase agreement, then that would very much depend on the coupon dates and the actual mechanics of the repo.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sat Nov 2nd, 2013 at 01:42:45 PM EST
[ Parent ]
Interestingly, the ECB's "general documentation" mentions both repo mechanics and collateralised loan mechanics, and makes no distinction between the two.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Sat Nov 2nd, 2013 at 02:46:45 PM EST
[ Parent ]


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