A new Canadian Dollar Term Loan Facility (TLF) will inject at least $8 billion into money markets, the Bank of Canada announced Wednesday.

“By providing greater flexibility for liquidity provision with respect to eligible collateral, the TLF will facilitate further improvement in money and credit markets,” the bank said in a release., adding that it will continue to provide additional term liquidity as long as conditions in financial markets warrant.

The TLF will be transacted through a single price auction process with direct participants in the Large Value Transfer System.

Four auctions of at least $2 billion each are planned for November 19 and 24, December 1 and 8.

Eligible collateral will be the non-mortgage loan portfolio as accepted on a temporary basis for LVTS and standing liquidity facility purposes.

IE