Deutsche Bank will act as the securities lending agent for securities purchased under the European Central Bank’s (ECB) public sector purchase programme (PSPP), subject to regulatory approval.
Under the PSPP, securities purchased by the ECB such as euro area sovereign bonds will be available for securities lending. The programme is aimed at primary dealers and other institutions with market making arrangements, provided they fulfil certain legal requirements.
Participants in the PSPP securities lending initiative will have to first sign a contractual agreement with Deutsche Bank.
According to the ECB, the securities lending arrangement is designed to allow eligible counterparties borrow securities at a fixed fee of 40 basis points.
The ECB and the central banks of Belgium, Germany, Estonia, Finland, Spain, the Netherlands, France and Lithuania launched the programme last month, with the aim to support bond and repo market liquidity without unduly curtailing normal repo market activity.
Deutsche Bank Named Agent for ECB PSPP Sec Lending Initiative
Deutsche Bank will act as the securities lending agent for securities purchased under the European Central Bank’s (ECB) public sector purchase programme (PSPP), subject to regulatory approval.