The Bank of England’s Contingent Non-Bank Repo Facility (CNRF) is now live, offering non-banks—including LDI funds, insurers, and pension funds—a critical liquidity backstop in times of market stress. However, firms must act fast to gain access, warns Victoria Saporta, BOE Executive Director for Markets.

Download my free guide to the facility here: https://lnkd.in/ekYzFb6g

Speaking to MNI, Saporta urged firms to sign up early, ensuring they can access funding before any future gilt market turbulence.

💬 “We encourage firms to sign up as early as possible so we don’t find ourselves in a position where the market is unprepared.”

🔑 What the BOE Wants Firms to Know

🔹 First approvals could come within weeks, but readiness is key.
🔹 The facility will only be triggered in severe market stress—not as routine support.
🔹 The BOE retains other crisis tools, including targeted gilt purchases.
🔹 The CNRF was designed after the September 2022 gilt crisis, when forced LDI fund sales drove yields to extreme levels.

💬 “This is an innovative tool that complements our existing toolkit, but it’s also historic—our first such lending facility for non-banks in 331 years.”

Despite its importance, the CNRF is not a free-for-all. It’s designed for institutions already holding gilts as part of their business model—a safeguard, not a market stimulus.

🏦 Not a “Grand Bargain”—Firms Must Qualify
Some expected the CNRF to reflect a “grand bargain” where the BOE supports non-banks in exchange for greater resilience. Saporta disagrees:

💬 “This is a lending facility. We lend to counterparties that have ex-ante resilience and meet regulatory standards. It’s not a grand bargain—it’s just how we extend our lending facilities.”

This means firms must:
✅ Meet regulatory and risk management standards—access is not automatic.
✅ Integrate CNRF into liquidity planning—it’s a safeguard, not a bailout.
✅ Demonstrate resilience—the BOE will not lend to firms without strong risk controls.

🔍 How SecFin Solutions can help

The CNRF changes non-bank liquidity management.
Firms must prepare now to qualify before the next stress event. SecFin Solutions helps firms:

📊 Assess CNRF eligibility—ensuring firms meet BOE requirements.
🔎 Optimise collateral & liquidity strategies—aligning repo, funding, and regulation.
📈 Stress-test funding strategies—evaluating resilience under market stress.
🔄 Navigate regulatory engagement—helping firms prepare for approval.

⏳ The Time to Act is Now
The BOE has made it clear—waiting until the next crisis is not an option. The CNRF is a powerful tool, but only for those who secure access before they need it.

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