Securities Lending
Summary
This practice note provides an overview of securities lending. Securities lending is an important financial services product provided by many institutions. Securities lending has experienced significant growth in line with the continued expansion of trading volumes, financial market deregulation, and securities innovation. As part of this growth, it has become a high-transaction-volume, operations-intensive business, usually involving sizable lending and investment portfolios. As such, it is a product that requires the coordination of numerous transaction processing, pricing, accounting, and settlement activities for diverse securities and markets, particularly when dealing with international securities lending. From a fiduciary perspective, the prudent management of a securities lending product entails specialized knowledge of money, credit markets, payment systems, and foreign exchange for the international markets, along with well-integrated internal controls and information ...