Thank you for the question.
Bank balance sheets, central bank balance sheets, are becoming matters of interest. It's an unusual time and we're having to deploy them in different ways. When you think about what we lend out as the Bank of Canada, the liability side of our balance sheet, the vast majority of our liabilities are bank notes that are around the country. The vast majority of our assets are Government of Canada bonds.
We have been providing some additional liquidity to the market. There's a real add-up problem here—we do some things overnight and then we do it again the next day and you don't add the two together. It's a portion of things being rolled over. Then there's the headline-grabbing $4 billion worth of term purchase and resale. In those cases, first, there's an agreement with a creditworthy institution. More important, though, we're taking assets in and applying what's called a haircut to those assets that reflect the volatility or price of those assets and the term over which we are “lending”—it's a purchase and resale agreement. So we're protected. If the counterparty were to go away, we'd have the asset. We'd realize the asset. So there's capital, if you will, in that haircut process.
That's how I would respond to your constituent.