Securities Lending

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Securities Lending

The act of loaning a stock, derivative, or other security to an investor or firm. Securities lending requires the borrower to put up collateral, whether cash, security, or a letter of credit. The completion of this transaction requires a securities lending agreement, which states, among other things, how long the loan lasts, what fee the lender receives, and the amount and type of collateral. Securities lending is important to short selling, in which an investor borrows securities in order to immediately sell them. The advantage of securities lending to the borrower is the fact that he/she may profit from shorting the securities; the advantage to the lender is the fee (and, if the borrower fails to repay, the collateral).
References in periodicals archive ?
Specialist investment advice: asset overlays, asset rebalancing, collateral management, derivatives, hedging, illiquid assets, responsible investment, stock lending, structured products, transition management, development and management of the PPF investment approach, Liability Driven Investment (LDI) management, strategic asset allocation and/or tactical asset allocation and other areas fund manager due diligence, analysis of co-investment/direct opportunities manager monitoring, research and selection in new/existing asset classes, operational reviews and other areas.
The TWSE has already introduced policies regarding stock lending by brokers.
During the period, the SCA took several measures including regulations for delivery-versus-payment, securities custodian, margin trading, short selling, stock lending and capital increase through rights issue.
David brings a unique combination of lending, bank operations and bank stock lending experience that will allow him to uniquely and logically move to the next step, that of providing capital solutions and M&A advisory," stated Craig Mueller, FIG's Managing Director.
FLS is a window through which banks can access cheap wholesale funding from the Bank of England up to a value pegged to their total stock lending to smaller businesses.
It would be introducing rules governing short-selling, stock lending and borrowing," Kazim told reporters on the sidelines of the Arab Federation of Exchanges Annual Conference in Abu Dhabi.
Aabar also continues to have the right to redelivery of an additional 43,109,726 Daimler shares, the ownership of which Aabar has transferred by way of stock lending as security to finance Aabar's original acquisition of Daimler shares.
Observers noted that the stock lending market looked extremely tight.
To introduce leverage product in the market, three different products - Margin Financing, Marin Trading and Stock Lending & Borrowing (SLB) were proposed.
Greece has addressed most of the issues raised by FTSE, such as off exchange transactions which have been enabled by MiFID and stock lending which has been liberalised.
Invoice finance from Leumi ABL can be combined with stock lending and plant & machinery finance.
Proprietary Data Explorers statistics, such as Utilisation*, are valuable and timely indicators of stock lending and short selling market depth.