In accordance with the schedule of term purchase and resale agreement (PRA) auctions for private sector money market instruments announced on 20 January, the Bank of Canada announced today that it will enter into a 13-day term PRA transaction for private sector money market instruments as follows:

Amount Auction Date Settlement Date Maturity Date
$1 billion 17 February 2009 19 February 2009 4 March 2009

The minimum bid rate for the auction will be announced on the Bank's web site at 9:00 (ET) on 17 February and will be calculated as a spread of 75 bps over the average of the Bank of Canada's overnight rate target and the 1-month OIS rate as observed by the Bank.

The auction will be held on 17 February at 10:15 (ET) and the results of this operation will be announced on the Bank's web site at 11:15 (ET). Primary Dealers must notify the Bank of Canada of the securities that will be used in the transaction, both by themselves and by their indirect bidders, by 12:00 (ET) on the day of the auction.

The total amount of assets acquired through this term PRA operation will be announced on the Bank's web site on the settlement day by 16:45 (ET). These transactions will also be reflected on the Bank of Canada's balance sheet.

Further detail for this operation, including the eligible securities, are available in the Terms and Conditions of the Term PRA Facility for Private Sector Money Market Instruments.

The Bank will continue to provide additional term liquidity as long as conditions in financial markets warrant.

Market participants requesting further information are asked to contact mmpra@bank-banque-canada.ca.

For press enquiries, please contact:
Jeremy Harrison
613 782-8782