Bank of Canada to take non-mortgage loans to Nov 09

TORONTO, Nov 5 (Reuters) - The Bank of Canada said on Wednesday that it will accept an assignment of non-mortgage loan portfolios as eligible collateral until November 2009.

The central bank said last month it would temporarily accept non-mortgage loans as collateral for participants in its Large Value Transfer System and standing liquidity facilities.

The temporary eligibility period was effective Oct. 20 and will continue through Nov. 2, 2009, the bank said.

The move is expected to provide additional liquidity to the Canadian financial system. Institutions can use marketable securities that are now pledged to the LVTS for other purposes, such as to support borrowing, and their funding costs are expected to fall, the bank has said. (Reporting by Lynne Olver; editing by Rob Wilson)