Section 2: Financial securities

Under a repurchase agreement, the seller retains the securities sold under a repurchase agreement as an asset on its balance sheet and records the amount of its debt to the buyer as a liability on its balance sheet; these securities and this debt are recorded under a specific heading in the seller’s accounts. In addition, the amount of the financial securities sold under a repurchase agreement, broken down according to…

Financial securities received under a repurchase agreement are not recorded on the transferee’s balance sheet; the transferee records the amount of its receivable from the transferor as an asset. When the transferee disposes of financial securities that it has itself received under a repurchase agreement, it recognises as a liability on its balance sheet the amount of this disposal representing its financial securities debt which, at the end of the…

For the purposes of articles L. 211-27 to L. 211-33, public or private bills are treated in the same way as financial securities. However, only credit institutions and finance companies may repurchase or reverse repurchase private bills.