LONDON (MNI) – The following is a verbatim text of the Bank of
England’s announcement that it is re-opening U.S. dollar liquidity
operations in an attempt to alleviate financial market stress:

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Co-ordinated Central Bank Actions

In response to the re-emergence of strains in U.S. dollar
short-term funding markets in Europe, the Bank of Canada, the Bank of
England, the European Central Bank, the Federal Reserve, and the Swiss
National Bank are announcing the re-establishment of temporary U.S.
dollar liquidity swap facilities. These facilities are designed to help
improve liquidity conditions in U.S. dollar funding markets and to
prevent the spread of strains to other markets and financial centres.
The Bank of Japan will be considering similar measures soon. Central
banks will continue to work together closely as needed to address
pressures in funding markets.

Bank of England US dollar repo operations

In parallel with other central banks, the Bank of England is today
announcing that its swap line with the Federal Reserve has been
reinstated and that it intends to resume conducting weekly tenders of US
dollar funding at one-week maturity. As before, these operations will be
at fixed interest rates with counterparties able to borrow any amount
against eligible collateral. The first tender will be held on Tuesday 11
May. The Bank will keep the frequency and maturity of its US dollar
operations under review, in light of market conditions.

Information on related actions being taken by other central banks
Similar announcement are being made by the European Central Bank, the
Bank of Japan and the Swiss National Bank. Information on the actions to
be taken by other central banks is available on the following websites:

US dollar repo operations are subject to the terms of the Sterling
Monetary Framework Documentation as supplemented and amended by the
Supplementary Terms, which can be found on the Bank of England website
at http://www.bankofengland.co.uk/markets/other/dollarrepo/index.htm.
The US dollar term repo operations use the Wider OMO Collateral pool,
details of which can be found at

http://www.bankofengland.co.uk/markets/money/wideromocollateral.htm.

Information on related actions being taken by other central banks

Information on the actions to be taken by other central banks is
available on the following websites:

Federal Reserve System (www.federalreserve.gov)
Bank of Canada (http://www.bankofcanada.ca)
Bank of Japan (http://www.boj.or.jp/en)
European Central Bank (http://www.ecb.int)
Swiss National Bank (http://www.snb.ch)

–London Newsroom, +44 207 862 7499; lcommons@marketnews.com

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