Uncleared Bilateral Repo
The only repo venue with no central clearance nor third-party settlement is called Non-Centrally Cleared Bilateral Repo (NCCBR), or uncleared bilateral.
NCCBR is unique. It is the biggest repo venue, but the most opaque. Specials trading (specific, sought-after collateral) is possible. What's unique from DVP specials, however, is that NCCBR allows for collateral with great credit risk. This is where equities and garbage debt (like CRE bonds or downgraded EM debt) can be repo'd.
The SEC’s proposal for repo to be centrally cleared, which is set to take effect on June 30 2026, may improve the "safety" of uncleared bilateral but also reduce Treasury market liquidity by raising the cost of repo financing (mandatory 2% haircuts).
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DT Primers Private Repo Venues The four private venues for repo trades include: 1) BONY Tri-Party Platform 2) DVP and GCF Repo (interdealer) 4) Uncleared bilateral (NCCBR) Big difference are the technical details related to settlement and clearing of the collateral:…
