When I was a banker, repos were first coming into common use. Since it consisted of one person in the bank on the phone, there was not much need for me (head of marketing research) to get involved.
In a bank with tens of $billions in deposits the daily fluctuation could be in the hundreds of $millions. Only a specific 20% had to be kept on deposit with the Fed, calculated every Wednesday, so the balance was borrowed or sold to adjust for the daily fluctuation.
Got what a repo is? A bank loan good for one or two days that pays interest. Large corporations, investment institutions and financial businesses slowly got into the repo business, over the years.
You can’t do any harm with a one or two day loan.
Everyone on the trading desk for repos (the one guy at my bank on the phone) knows everyone else in the business. No con men get into that tight circle. For that matter, the same is true of government bond trading desks. Simple, honest and straight-forward, trading $billions a minute.
* (Photo from a Hotel named Repos in Croatia)