Market Notice
The Bank of England (the Bank) announced on 11 June 2025 its intention to increase the minimum spread over Bank Rate on bids against Level A collateral in the Indexed Long-Term Repo (ILTR) from 0 basis points to 3 basis points in November 2025.
The Bank is today confirming that this change will take effect from week commencing 17 November 2025 and applies to new drawings from that date. The first operation with the updated pricing will take place on 18 November 2025.
The modest increase in the spread over Bank Rate is intended to balance incentives for participants between the Short-Term Repo (STR) and ILTR facilities against Level A collateral by more closely aligning the effective costs of the facilities given the longer tenor of the ILTR. The Bank does not intend to change minimum spreads on Level B and C collateral at this time.
All other ILTR operation parameters remain unchanged.
Participants should review the ‘Using the ILTR: a guide for participants’ which has details on how the ILTR works, principles for effective participation, as well as examples of auction outcomes for different levels of demand. Participants should also review the relevant settlement process information for ILTR operations.
As with all SMF facilities, the Bank will keep the calibration of the ILTR under review and may periodically update the parameters. Decisions regarding changes to the ILTR will be taken to ensure that its terms remain robust to structural changes in market conditions and continue to meet the Bank’s policy objectives.
Other than as amended by this Market Notice, the Terms and Conditions and Operating Procedures for participation in the Bank’s Sterling Monetary Framework will continue to apply to ILTR operations.