Bank of Canada Announces Details of its 28 Day Term PRA Transaction

In light of increased pressures in term lending markets, the Bank of Canada announced today that it will enter into a 28-day Purchase and Resale Agreement (PRA) transaction as follows:

*This term PRA was announced 25 September as part of the Bank's schedule of future term PRA transactions. According to that schedule, there will also be a term PRA transacted on 30 October for a further 28-day term.

The list of eligible securities for these transactions is the same as the full list of securities eligible as collateral for the Bank's Standing Liquidity Facility (SLF) and is available at: https://www.bankofcanada.ca/en/financial/securities.pdf

Securities used in these term PRA transactions will be subject to the same margin requirements as those applicable in SLF transactions.

These term PRAs will be transacted with Primary Dealers (PDs). 1 Each PD will have a bidding limit of 25% of the auctioned amount and will be subject to a maximum aggregate of all outstanding Term PRAs. For PDs rated A or higher, the maximum aggregate limit will be 25% of the total outstanding; for PDs rated either BBB or lower or those without a rating, the limit will be 12.5%. There will be no right of substitution of the securities underlying the transaction.

The results of these operations will be announced on the Bank's web site at 10:15 (ET). The total amount of assets acquired on any day through term PRA operations will be announced on the Bank's web site by 16:45 (ET). The assets will also be reported on the Bank of Canada's balance sheet.

The Bank will continue to provide additional term liquidity as long as conditions in financial markets warrant.

For further information, please contact:
Jill Vardy
613 782-8782