PASHA Bank offers its customers REPO and Reverse REPO transactions for purchase and sale of securities in local and international stock markets.
REPO is the act of selling of securities together with an agreement to buy them back. In cases when the bond owner requires additional funds, he signs the agreement to sell securities in his portfolio to other party together with an agreement for the seller to buy back the securities at a later agreed date and price (with interest).
Advantages of REPO transactions
• Ability to attract funds using bonds in portfolio as a collateral;
• High liquidity;
• Interest earnings;
• Ability to receive financing at cheaper rates than loans;
• Meeting liquidity needs without complete bonds selling;
• Independence from single investor
Reverse REPO Transactions
Reverse REPO is the act of purchasing of securities together with an agreement to sell them back. It is a purchase deal considering the investment to bonds offered by the party in need of additional funds in cases of short-term excess liquidity together with an agreement for the buyer to sell bonds back at a later agreed date and price (with interest).
Advantages of reverse REPO transactions
• Planning at will and regulation of fund flow
• Identification of income beforehand
• Profitability is not affected by any price change
• Not depending on single participant
• Applicable to state and corporate bonds