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Cash Collateral Lending Takeup Has Been Elevated This Year

ECB

Further to the ECB's increase in the limit on securities lending vs cash to E250B from E150B this morning, here is a chart of the ECB securities lending against collateral (daily through Sept, Oct data will be out later this month).

  • The year-end spikes in takeup are noted in the chart (as ECB's Schnabel said, this is a “precautionary measure to ease collateral scarcity and support market functioning around the year-end”), and the narrowing in ASW-bond spreads suggests that the market has taken some comfort from the announcement.
  • At the last count, there was E77.1B lent against cash collateral (Sept 30th). The peak was E97.9B over year-end 2021.
  • Overall, takeup has been much more elevated this year than in previous years amid collateral scarcity, averaging E60B daily over the most recent 3 months (through Sep).

Source: ECB, MNI

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Further to the ECB's increase in the limit on securities lending vs cash to E250B from E150B this morning, here is a chart of the ECB securities lending against collateral (daily through Sept, Oct data will be out later this month).

  • The year-end spikes in takeup are noted in the chart (as ECB's Schnabel said, this is a “precautionary measure to ease collateral scarcity and support market functioning around the year-end”), and the narrowing in ASW-bond spreads suggests that the market has taken some comfort from the announcement.
  • At the last count, there was E77.1B lent against cash collateral (Sept 30th). The peak was E97.9B over year-end 2021.
  • Overall, takeup has been much more elevated this year than in previous years amid collateral scarcity, averaging E60B daily over the most recent 3 months (through Sep).

Source: ECB, MNI