The usage of security lending facilities under unconventional monetary policy : evidence from Sweden / Marianna Blix Grimaldi, David Vestin, Fabienne Schneider.: FB3-5/2026-9E-PDF
"This paper examines the interaction between quantitative easing (QE) and the securities lending facility (SLF) using a detailed dataset on Riksbank QE purchases, Swedish DMO SLF transactions and OTC repo deals. A theoretical model further shows how excess demand for assets and search frictions shift the SLF from a backstop to a first-resort tool. Empirically and theoretically, we find that QE expansion is closely linked to higher SLF use. Narrowing spreads between SLF yields and market repo rates make the SLF yield a floor for secured lending, weakening ties to monetary policy benchmarks and potentially altering its transmission. QE announcements also increase SLF usage, raising moral hazard concerns. Theoretically, QE strengthens cash-borrowing dealers’ bargaining position and may reduce reliance on the repo market, with implications for market liquidity"--Abstract.
Permanent link to this Catalogue record:
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| Title | The usage of security lending facilities under unconventional monetary policy : evidence from Sweden / Marianna Blix Grimaldi, David Vestin, Fabienne Schneider. |
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| Publication type | Monograph - View Master Record |
| Language | [English] |
| Format | Digital text |
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| Description | 1 online resource (64 pages) : graphs, figure. |
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