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FRANKFURT, May 11 (Reuters) - The use and re-use of the same assets as collateral to borrow cash, financial markets' main money-spinner, needs to be better regulated to reduce the risk of a new credit bubble, the vice president of the European Central Bank said on Thursday.
"One area that still lacks reform concerns re-hypothecation and re-use of collateral," Vitor Constancio told an ECB conference.
"...There is a push to exclude repos from the leverage ratio calculation under way that not only weakens the standard but also eliminates the only brake to banks’ capacity to the unconstrained creation of inside liquidity." (Reporting By Francesco Canepa; editing by John Stonestreet)