Availability for Collateral Reuse

Field 2.95 | Matching Date: 2020-04-01 | Tolerance: None | Agent Lender Data Provision: Yes>

Status: Best Practice Finalised, Last Updated: 26/04/2021

Field 2.95 | Matching Date: 2020-04-01 | Tolerance: None | Agent Lender Data Provision: Yes

Description:
Indication whether the collateral taker can reuse the securities provided as a collateral.

Best Practice:
If Field 2.75 (Type of Collateral Component) is populated with "SECU", this field shall be populated and should contain either "TRUE" or "FALSE", else it should be left blank.

If the market trading agreement (GMSLA, GMRA, etc.) under which the SFT is governed permits re-use, then participants may decide that Field 2.95 (Available for Collateral Re-use) must be populated with "TRUE", regardless of any other client contracts (SLAA) or prevailing regulations (UCITS) that actually preclude re-use, otherwise populate with "FALSE".

At transactional level for repos it has been opined that this should be populated as "TRUE", as this contractually reflects the GMRA, even if UCITS funds are not actually permitted to re-use due to restrictions placed by ESMA.

Many participants have advised that they plan to always report re-use as zero for securities lending and borrowing activity, which means populating Field 2.95 (Availability for Collateral Reuse) as "FALSE", due to ESMA restrictions which forbids it, as do the triparty agreements. (SFTR-115)