PRESS RELEASE
ECB and Bank of Albania set up repo line to provide euro liquidity

The Bank of Albania has assessed and emphasised that COVID-19 pandemic outbreak found the Albanian banking system liquid and well-capitalised. This sound situation is expected to continue in the future as well.  

As a precautionary measure, the Bank of Albania has come to an agreement with the European Central Bank (ECB) to set up a REPO line arrangement.

REPO is a form of collaterised borrowing. In this context, the Bank of Albania, temporarily sells securities held in its balance sheet to the ECB, committing to repurchase them in accordance with the predetermined conditions with ECB.

The liquidity provided under this arrangement, will be available to the Albanian banking system through the Bank of Albania. This instrument is a backstop facility to be employed in case of market dysfunctions due to the COVID-19 shock. The repo line will remain in place until June 2021, unless an extension is decided.

Further information can be found in the following ECB press release.

• Link: ECB’s press release