Consider the following statements regarding Long-Term Repo Operations (LTRO):
1. It allows the central bank to lend money to banks for one to three years at the current repo rate.
2. In LTRO, banks are required to provide collateral in the form of government securities with a similar or longer-term maturity.

Which of the statements given above is/are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2

Question

Consider the following statements regarding Long-Term Repo Operations (LTRO):
1. It allows the central bank to lend money to banks for one to three years at the current repo rate.
2. In LTRO, banks are required to provide collateral in the form of government securities with a similar or longer-term maturity.

Which of the statements given above is/are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2

TutorArc · Accepted Answer

Statement 1 is correct : The Long-Term Repo Operations (LTRO) framework allows the central bank (RBI) to lend money to banks for a period of one to three years at the current repo rate.

Statement 2 is correct : Under the LTRO framework, banks are required to provide collateral in the form of government securities that have a similar or longer-term maturity than the term of the loan.

Monetary Policy

Long-Term Repo Operations (LTRO)

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M Question 1	⏱ 0
Consider the following statements regarding Long-Term Repo Operations (LTRO): 1. It allows the central bank to lend money to banks for one to three years at the current repo rate. 2. In LTRO, banks are required to provide collateral in the form of government securities with a similar or longer-term maturity. Which of the statements given above is/are correct? (a) 1 only (b) 2 only (c) Both 1 and 2 (d) Neither 1 nor 2

Monetary Policy

Long-Term Repo Operations (LTRO)

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