// definition
Rehypothecation
Reuse of collateral
freshreviewed 0 days ago
Short definition
Using received collateral in another transaction. Strictly, rehypothecation concerns pledged assets; reuse under a title-transfer repo involves an obligation to return equivalent securities. Rights depend on the contract and governing law. Reuse supports funding while connecting counterparties’ risks.
risk atlas
Knowledge map
Intuition
Successive claims can finance the same portfolio without multiplying the underlying securities.
Related analyses
Primary sources
- FSB, repo market vulnerabilities, February 2026Section 3.1.3: benefits and interdependencies of collateral reuse.
- ESMA, SFTR Article 15Risk information, prior agreement and conditions for reuse.
- ICMA, rehypothecation FAQIndustry conventions: pledges, title transfer and equivalent securities.