Dr Ivan Sangiorgi talks to Bloomberg about central bank repo facilities

Dr Ivan Sangiorgi, Associate Professor of Finance at the ICMA Centre, has been quoted in two recent Bloomberg articles examining the role of central bank repo facilities and their implications for bond markets and financial stability.

The first article, “Banks Tap Billions in BOE Repo Cash to Profit on Bond Trades”, examines banks’ growing use of the Bank of England’s Short-Term Repo (STR) facility. It discusses how banks can use central bank liquidity to finance holdings of higher-yielding UK government bonds and considers the implications of the rapid increase in use of the facility.

Ivan commented on the need to consider the potential implications for taxpayers, while emphasising that increasing use of the facility does not in itself indicate misuse and may also reflect greater demand for liquidity within the Bank of England’s evolving reserves framework.

A second Bloomberg article, “Europe’s Bond Market Turbulence Puts ECB Repo Funding Into Focus”, discusses the ECB’s repo facilities amid renewed turbulence in European bond markets.

It explores the role of central bank funding facilities, the challenges posed by liquidity stigma, and the implications for financial stability and bond market functioning. Dr Sangiorgi commented:

“The ECB has put many of the right elements in place, but normalisation requires not only a change in communication and pricing but also repeated use by a sufficiently broad range of banks.”

The two contributions draw on Ivan’s research and teaching expertise in bond and money markets, repo markets, sovereign debt and central banking.