While private securitization markets in Europe have virtually shriveled up, banks and other issuers can still turn to a rich uncle: central banks will accept their RMBS paper as collateral for repo financing.

Although the European Central Bank (ECB) and the Bank of England (BoE) repo structures have been open for years, "the credit crisis has made everyone aware of how it works and what collateral is eligible," said Christopher Greener, senior analyst at Societe Generale. Since last August, the facilities have become a very popular outlet.

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