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Bank A needs cash quickly and owns bonds, while Bank B has excess cash. To meet its cash needs, Bank A engages in a repurchase agreement (repo) with Bank B. In this arrangement, Bank A (the dealer) sells its bonds to Bank B with an agreement to repurchase them shortly after, typically the next day. Bank B provides the required cash to Bank A and, when the time comes, Bank A buys back the bonds at a higher price. This allows Bank A to obtain needed cash while Bank B earns a profit. From Bank A's perspective, it's a repo, and from Bank B's perspective, it's a reverse repo. This process is utilized by various entities, including banks, mutual funds, hedge funds, and central banks.