london dec 14 reuters  britain should consider giving nonbanks access to its repurchase agreements and government bond operations as a source of liquidity in stressed markets the international monetary fund recommended on tuesday nonbanks comprise hedge funds mutual funds pension funds money market funds and insurance companies which collectively now account for half of global financial activity read more the bank of england like its counterparts in the united states and the euro zone injected liquidity into markets as economies went into lockdown in march 2020 to fight covid19 creating a dash for cash intervention prevented money market funds and other market participants from freezing up but regulators globally are looking at what measures can be taken to avoid having to do the same again in the next market crisis this is a major crossborder challenge the imf said in an assessment of britains economy and financial system meanwhile the authorities should strengthen backstops to the functioning of core markets in times of stress by considering allowing appropriately regulated large interconnected nonbank financial intermediaries access to repo andor gilt purchase operations the imf said banks already have access to such operations the imf said the financial cycle in britain appeared to be slightly ahead of the economic one and it called for continuing assiduous macroprudential and supervisory vigilance it welcomed the boes decision on monday to require banks to build up their rainy day capital buffers adding that britain had made major strides in laying out its postbrexit financial sector frameworks at the same time as the uk concludes a review of its own postbrexit financial regulatory framework it will be important to preserve the primacy of financial stability objectives and safeguard the robust management of domestic and crossborder macroeconomic and financial sector systemic risks it said britains finance ministry has proposed that uk regulators have an objective of maintaining the competitiveness of the financial sector which had raised concerns at the boe