Promnet Reverse Repo
Using Promnet Reverse RepoSM, financial institutions can gain more control over their cost of funds, liquidity, and valuable customer relationships. Financial institutions can:
- Avoid turning away customers whose deposits may otherwise negatively impact the financial institution's balance sheet
- Offer customers daily liquidity, the opportunity to earn a return, and the safety of having their funds backed by U.S. Treasuries (to 101-102%) and/or by Agency MBS (to 103%)
- Protect lucrative customer relationships
- Enjoy fee income—participating financial institutions can receive a fee based on volume
Neither the Cash nor Securities Stay On Balance Sheet—How It Works
First, a Promontory Network member accesses the repo transaction platform via Promontory's Transaction & Reporting Portal. Then, the financial institution, as the Relationship Institution, enters into a Repurchase Agreement as agent for its customer. The custodian, BNY Mellon, holds cash and securities and sends or receives funding by wire. All funds and securities are moved off the financial institution's balance sheet and the financial institution retains the customer relationship.
The Promnet Reverse Repo service is provided by Assetpoint Financial, LLC, a wholly owned subsidiary of Promontory Interfinancial Network, LLC and a member of FINRA and SIPC. Use of the Promnet Reverse Repo service is subject to the terms, conditions, and disclosures set forth in the Promnet Reverse Repo agreements, including the Promnet Reverse Repo Service Agreement. Assetpoint Financial, LLC does not purchase or sell any securities in connection with repurchase agreement transactions effected using the Promnet Reverse Repo service. Promnet Reverse Repo is a service mark of Promontory Interfinancial Network, LLC.