Hi,could you please help me on the problem I am facing?I need to create a discount curve when collateral is not cash but an asset. The asset is: German/Dutch/French government bonds with haircut.I consider two approaches:1) Using repo rates at the short end of the curve. What should I use for the long end of the curve? 2) Using OIS discounting. I have checked that the repo rates (/EUR3MRPFIX=FBE) and OIS (EUREON3M=) are very close to each other. Practically the same for the last 5 years. This suggest that OIS is fair enough approximation. Based on my calculation when OIS discounting is used, haircut effect cancels out and does not have any impact. Is the second approach acceptable? Do you have any comments?Thanks for any help,Zibi

For practical purposes, it's safe to assume that govt bonds (esp the ones you have mentioned) are the same as cash, when used as collateral. Therefore, using OIS discounting should be fine.