Transactions of repo loans rise 3.16% in Q3

Transactions of repurchase agreement (RP) loans among financial institutions grew more than 3 percent in the third quarter from a year earlier, data showed Thursday.

The combined turnover of RP loans extended by local institutions and brokerages reached 12,862 trillion won ($9.62 trillion) as of end-September, up 3.16 percent from a year ago, according to data from the Korea Securities Depository.

An RP allows a borrower to use a security as collateral for a cash loan at a fixed interest rate and buy it back from the lender at a set price at a later date.

The outstanding value of RP transactions stood at 271.2 trillion won as of end-September, up 8.13 percent from a year earlier, according to the data.