Government Securities Division

The DVP Service offered by FICC’s Government Securities Division (GSD) supports and facilitates the submission, comparison, risk management, netting, and settlement of trades executed by its Members in the U.S. Government securities market.

The GCF Repo® Service enables dealers to trade general collateral repos, based on rate, term, and underlying product, throughout the day without requiring intra-day, trade-for-trade settlement on a Delivery-versus-Payment (DVP) basis.  

To participate in the GCF Repo® Service, dealers must be netting members of FICC’s Government Securities Division (GSD).

Dealers execute GCF Repos through Inter-Dealer Brokers, who are also Members of GSD on an anonymous or “blind” basis. Brokers are then required to submit trade data on GCF Repo transactions to FICC shortly after trade execution. Upon receipt of the data, FICC immediately reports the transaction details to the dealers. The most recent trades and position information are displayed simultaneously. Position information is available both at the individual CUSIP level and at the cumulative, overall level.

When GSD receives the trade data from the locked-in trade source, it becomes the settlement counterparty to each dealer and guarantees settlement of the transactions. GCF Repo transactions are settled on a tri-party basis, which requires dealer participants to have an account with the participant clearing bank(s).

Eligible Collateral Types

Collateral currently accepted for GCF Repos include:

• U.S. Treasury Bills, Bonds and Notes,
• U.S. Treasury Inflation Protected Securities (TIPS),
• Fixed-and-adjustable-rate mortgage-backed securities issued by Fannie Mae, Ginnie Mae and Freddie Mac,
• Non-mortgage backed securities issued by government-sponsored enterprises, such as the Federal Home Loan Bank, Federal Farm Credit Banks and Federal Home Loan Mortgage Corporation (Freddie Mac), and
• STRIPS (STRIPS are U.S. Treasury and agency securities that have had the interest-payment coupons separated or “stripped” from the principal, creating zero-coupon securities and separate payment securities from what was originally a single Treasury bond or note).

FICC’s Sponsored Service allows certain Netting Members to sponsor, as Sponsoring Members, eligible legal entities, as Sponsored Members, into FICC/GSD Membership. A Sponsoring Member is permitted to submit to FICC on behalf of its Sponsored Members, transactions in eligible securities for comparison and novation.