Purchase and Resale Agreements - PRAs


DEFINITION of 'Purchase and Resale Agreements - PRAs'

An arrangement between the Bank of Canada and dealers whereby the Bank buys treasuries from a dealer, and the dealer agrees to repurchase the treasuries the next day.

BREAKING DOWN 'Purchase and Resale Agreements - PRAs'

In a PRA, the Bank of Canada is essentially lending money to the dealer at the midpoint of the overnight operating band rate in order to increase the dealer's liquidity.

  1. Overnight Rate

    The interest rate at which a depository institution lends immediately ...
  2. Special Purchase and Resale Agreement ...

    An open market operation in which the Bank of Canada purchases ...
  3. Open Market Operations - OMO

    The buying and selling of government securities in the open market ...
  4. Remittance

    The term most commonly refers to money being sent via mail or ...
  5. Term Deposit

    A deposit held at a financial institution that has a fixed term, ...
  6. Structured Transaction

    A series of transactions that could have been treated as a single ...
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