Repo Market for Specified Securities

Repo Market for Specified Securities

The Market provides the opportunity to realize repo transactions on preferred securities within the organized market and then to deliver such securities to the buyer.

In the Market, sales with repurchase agreement and purchases with resale agreement are executed over a specified security. In these transactions, it is possible to negotiate by specifying the price of the security in addition to the repo rate. In the Market, government debt securities (GDS), Government Lease Certificates, revenue-sharing certificates (RSC), private debt securities and lease certificates listed on the Exchange, private sector borrowing instruments issued at Offering Market for Qualified Investors (only between qualified investors), which have been issued in Turkish Lira, also debt securities issued in Turkish Lira by the Privatization Administration, Housing Development Administration of Turkey, and local administrations, and liquidity bonds issued by the Central Bank of the Republic of Turkey can be traded.

During the repo term, the securities are not blocked, and are delivered to the buyer. At maturity, the buying party will deliver the same type and amount of securities to Takasbank to be transferred to the selling party. Trades can be executed with a starting value date being the prevailing date, or a future date up to 7 days.

Takasbank acts as Central Counterparty (CCP) in all TL denominated Government Debt Securities and TL denominated securities issued by banks traded in the Repo Market for Specified Securities.

Order Types

Limit Order

Limit orders are placed by specifying repo rate, repo security price, price/yield and nominal value in multiples of the minimum order size. The non-executed part of the order remains passive in the system.

Market Order

In this type of orders, a price/yield is not specified. The order given in multiples of the minimum order size is fully or partially matched by passive orders and the non-executed part of the order is cancelled.

Limit Order and Market Order can be given to include the specific conditions defined below.

Fill and Kill Order

It is an active order type subject to the condition of execution in part. As soon as it is entered, this order matches with the outstanding counter-orders, and its non-executed part is automatically cancelled.  It may be given in the form of a “Limit Order” or a “Market Order”.

Fill or Kill Order

It is an active order type subject to the condition of execution in full. If this condition is not met as soon as the order is entered, the order is cancelled. It may be given in the form of a “Limit Order” or a “Market Order”.

Validity Periods of Orders

Orders are valid for the day on which they are placed. All orders with a value date being the prevailing day are cancelled at 14.00 hrs if not executed, and those with a future value date are cancelled at the market closing hour.

Order Rules

Order Matching Rules

On the market, transactions are executed according to multi price continuous auction method. In the execution of orders, repo rate and security price at the relevant repo maturity are taken into account. If repo rate and security price are equal, then time priority applies. Accordingly,

- repo orders are matched with reverse-repo orders with the same or a lower rate and with the same or a higher security price;

- reverse repo orders are matched with repo orders with the same or a higher rate and with the same or a lower security price.

Order Entry Methods

Orders conveyed to the Market are entered in a certain price type determined by Borsa İstanbul for each security as well as the repo rate.

a) Securities for which orders are entered in clean price;

Separately-traded principals of coupon bonds (except CPI indexed bonds) fixed-rate bonds and fixed yield lease certificates, floating-rate bonds payable in TL the first coupon interest rates of which are fixed (Clean price net of inflation is used for CPI indexed Government bonds which are issued by the Treasury since February 2007).

b) Securities for which orders are entered in dirty price;

Securities traded at discount, separately-traded coupons of coupon bonds, floating-rate bonds the first coupon rates of which are not fixed, (Dirty price net of inflation is used for the separately traded coupons and principals of CPI-indexed Government bonds which are issued by the Treasury since February 2007).

The price field found in the trading system and the bulletins indicates the clean or dirty price chosen at the time of entry of the order. For each security, in addition to the price, settlement price and if any accrued interest or accrued lease are also announced.

Rate and Price Ticks

In entering the orders to the market, a tick of 0.01% is used for the repo rate whereas a tick of TL 0.001 is used for the security price.

Order Change

Unmatched orders and unexecuted parts of partially matched orders transmitted to the market can be changed.

While the change in the repo rate and security price of the order, increase in amount and change of portfolio/fund/customer code lead to the loss of time priority, the change of reference information and reduction of repo amount do not give rise to loss of time priority.

Order Cancellation

Unmatched orders and the unexecuted part of matched orders transmitted to the Market can be canceled.

Order Size

Orders are transmitted in minimum order size and its multiplies. The minimum and maximum order sizes in effect are as follows:

Minimum Maximum
10.000 20.000.000
Value Dates

Orders may be transmitted to the Market with a future starting value date up to 7 days. Repo end value date can be one year the most.

Related Files

guidebook_rssm.pdf