Securities Finance

The Benefits of Securities Lending

Our experts discuss why investors participate in securities lending and highlight recent market trends.

December 2020

Lending idle inventory can improve the bottom line for both asset managers and owners.

In today’s cost-sensitive environment, securities lending can offer a clear pathway for asset managers to lower their expense ratios and compete more effectively. For asset owners, it can be a key source of income to help maintain funding levels. Many institutions left securities lending in the wake of the great financial crisis due to underlying risks. As the rise of non-cash collateral in the US helped to mitigate risk, institutions are cautiously returning to the securities lending market.