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In a scenario where Bank A urgently needs cash and owns bonds, it can enter into a repurchase agreement (repo) with Bank B, which has excess cash. In this arrangement, Bank A, referred to as the dealer, transfers its bonds to Bank B in exchange for cash, with a commitment to repurchase the bonds at a later date—often the next day—at a higher price. This allows Bank A to obtain the necessary cash, while Bank B benefits financially from the transaction. For Bank A, this is a repo transaction, while for Bank B, it is considered a reverse repo, as it involves buying securities with the intention to sell them back for profit. Repo transactions are common among banks, mutual funds, hedge funds, and even central banks.