Repurchase Agreements (Repos) and Their Role in Liquidity Risk Management A Comparative Jurisprudential Study

This research examines repurchase agreements (repo), which address the liquidity crisis in banks. The research aims to highlight the role of repo agreements in managing bank liquidity, explain how the central bank manages monetary policy through repo agreements, detail the jurisprudential classification of repo agreements, and clarify the extent of the legal necessity for using repo agreements. The importance of the research lies in its jurisprudential approach, which addresses one of the most well-known and widely used liquidity management tools in most countries worldwide. This tool has a significant impact on the macroeconomy, which in turn reflects the diverse nations and societies. The research uses the descriptive and analytical approach to explain the concept of repo agreements and how to deal with them. It also uses the deductive approach to understand the jurisprudential ruling on repo agreements by examining this issue from other branches of jurisprudence and proposing the most important solutions to address the liquidity problem in banks. The research also uses the comparative critical approach to explain the opinions of jurists and discuss what, in the researcher's opinion, merits discussion, arriving at the most plausible conclusion on the issue. The research reached several conclusions, the most important of which are: The traditional view of conventional banks and the central bank is based on the use of repo agreements to manage liquidity in banks, whether in the event of a deficit or a surplus. The repo agreement is also based on a condition in the contract, which is that the seller reclaims the sold item. This condition prohibits the sale of 'inah according to the consensus of jurists. It is noted that the subject of the repo contract is the securities, bonds, which are essentially prohibited, unlike the sale of 'inah and the sale of wafa, which are supposed to permit the subject of the contract, despite their prohibition according to the majority of jurists. Therefore, the repo agreement is a type of interest-