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3.7.1 Bond repo may be in the form of collateral repo or in other trading forms.
3.7.2 Bond collateral repo refers to a bond repurchase agreement whereby at the time the bond holder pledges its bonds as collateral in exchange for a cash loan equivalent to the standard bonds converted from such bonds at a conversion ratio, the two parties agree to return the cash and release the bonds pledged as collateral upon expiry of the term of the repo.
3.7.3 The term of bond repo is based on calendar days. In case the date of expiry coincides with a non-trading day, settlement is carried out on the following trading day. |
