REPO MADNESS

摘要

Toput it mildly, the eurozone debt crisis has fueled mistrust of the banking system. Worried about banks' heavy exposure to high-risk sovereign bonds, other financial institutions fret over lending them cash. As a result, unsecured borrowing by European banks has plunged in favor of secured funding. The repurchase agreements market plays a big role in these collateral-based deals. "In the second half of last year, there was a long period of next to no unsecured issuance," says Colin Fleury, head of asset-backed securities investment at Henderson Global Investors in London.