Bangladesh Bank discontinues 360-day special repo

The central bank today scrapped the 360-day special repo facility thanks to the improvement in the coronavirus situation and a lack of demand for the borrowing tool.

In May 2020, the Bangladesh Bank introduced the special repo in order to implement the stimulus packages, unveiled by the government and the BB, and to ensure smooth liquidity management.

A repurchase agreement, or repo, is a short-term agreement to sell securities in order to buy them back at a slightly higher price.

Under the special repo, banks and financial institutions were able to borrow against additional treasury bills and bonds of statutory deposit rate with the BB.