BNY has completed its first intraday triparty repo trades, offering a new level of flexibility for market participants managing short-term funding and collateral. The pilot, conducted in February, saw UBS borrow USD from Swiss Re via BNY’s triparty platform, with the transaction starting and maturing within the same trading day. A second trade followed in April, with Santander and Rabobank executing intraday repos in both directions, borrowing and lending, using the same infrastructure according to a press release.
What sets this development apart is the ability to run intraday repos through existing triparty agreements, removing the need for additional legal documentation. This lowers the barrier to entry and allows institutions to source or deploy liquidity for just a few hours, rather than locking in overnight exposure, states BNY. For lenders, it offers the potential to earn returns on idle cash. For borrowers, it allows more targeted funding aligned with intraday liquidity needs.
Notable shift
Traditionally, triparty repo markets have focused on overnight or term funding. The introduction of intraday functionality, where collateral is allocated, returned, and settled within hours, marks a notable shift in post-trade practices.
It reflects, according to BNY, growing demand for tools that can support more agile liquidity and collateral management, especially in an environment of tighter regulatory requirements and increasing intraday payment flows.
