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RBA Glossary definition for margin loans
margin loans – Loans which are made to investors to purchase financial assets, usually equities or units in managed funds. These assets are used as security for the margin loan. Margin loan clients are required to keep the ratio of borrowings to the value of underlying security below a pre-arranged level. When the ratio goes above this level, lenders will make a margin call, requiring the borrower to either repay some of the loan or provide additional security to support the loan.
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Emergency Liquidity Injections
1 Oct 2019
RDP
2019-10
In the model presented here, lending policies that permit banks to repay the loans after conditions improve are more credible than a securities purchase policy. ... The shock b can be interpreted as short-term creditors not rolling over debt, withdrawing
https://www.rba.gov.au/publications/rdp/2019/2019-10/full.html
Introduction
9 Oct 2019
RDP
2019-10
Fischer 1999). This paper demonstrates an equivalency between the two. Achieving (ii) requires that liquidity risk-taking be costly at the margin, and since the marginal effect of taking liquidity risk ... In the model presented here, lending policies
https://www.rba.gov.au/publications/rdp/2019/2019-10/introduction.html