"DTCC Starts Publishing Daily Index of General Collateral Repo Rates" says a press release on TradingMarkets.com. It explains, "The Depository Trust & Clearing Corp. (DTCC) said that it has begun publishing the financial service industry's first index to list average daily interest rates for the multi-billion-dollar daily market in General Collateral Finance (GCF) repurchase agreements (repos). The new DTCC GCF Repo Index lists the average interest rate paid each day for the most-traded general collateral repos involving U.S. Treasury securities, federal agency securities and mortgage-backed securities issued by Fannie Mae and the Federal Home Loan Mortgage Corp. The index also records the total par value of these repo transactions each day. Repos are typically a form of short-term secured loan that involves the sale of a security and the subsequent repurchase of the same security. Trading in GCF repos averaged more than $690 billion a day in 2009." Murray Pozmanter, DTCC managing director, Fixed Income Clearing and Settlement, says, "Leveraging our data to make these repo rates public will bring some much-needed transparency to this large and crucial market. It's one of a number of initiatives we're taking at DTCC to meet the needs of our customers for ways to manage risk, and to meet the needs of regulators for more accurate and timely information to supervise markets." The release adds, "According to the Company, daily publication of the GCF Repo rates will help dealers and investors to manage their portfolios and calculate the value of the securities they hold in inventory. The new index will also enable institutional investors and corporations to estimate their short-term funding costs more accurately. In addition, having the interest rate data publicly available each day will create greater transparency and help regulators conduct risk management oversight in the General Collateral repo market. The index will be published daily on DTCC's public website and includes data going back a year as well as analytical tools that allow the construction of trend lines and comparison of the different asset types."
