TY - JOUR T1 - Explaining Recent Modifications to the Treatment and Use of Repurchase Transactions JF - The Journal of Structured Finance SP - 62 LP - 68 DO - 10.3905/jsf.2015.21.3.062 VL - 21 IS - 3 AU - David F. Salerno AU - John A. Ruddy AU - Murli Rajan Y1 - 2015/10/31 UR - https://pm-research.com/content/21/3/62.abstract N2 - The research outlined in this article considers recent events that have transpired in the repurchase transaction market. In the United States, the Financial Accounting Standards Board (FASB) has changed the accounting treatment of repurchase transactions. Across the globe, regulators have changed the treatment and capital required for financial institutions to participate in repurchase transactions. The intended effect is clear: new rules treat repurchase agreements as debt and require participating institutions to provide additional financial statement disclosures about repurchase agreement activities. What impact will the stricter rules have on the repurchase transaction market? Federal Reserve data on the repurchase transaction market suggest that the recent changes have decreased repurchase market activity. Remaining questions for practitioners and theoreticians might include the effect that a smaller repo market might have on other credit markets as well as the financial markets as a whole.TOPICS: Fixed income and structured finance, legal/regulatory/public policy ER -