ISLA and the French toolkit
14 June 2011 Paris
Image: Shutterstock
The International Securities Lending Association (ISLA) and Societe Generale Securities Services (SGSS) have published a guide to enhance French mutual funds and other investors’ understanding of the securities lending market.
The guide is based on English language versions of documents first produced in late 2010 by a group of leading financial trade associations, including ISLA. The French versions include an introductory guide and a checklist for investors who are contemplating starting securities lending programmes for the first time.
Securities lending is an investment technique which can generate incremental returns on portfolios of shares and bonds. Investors lend securities to borrowers, such as market makers and investment banks, who pay the lender a fee. Loans are secured with collateral and business is conducted under well-developed master agreements.
Whilst much has been written on the subject of securities lending, most of the materials available are aimed at readers with an existing degree of understanding of the business. Trustees and others with responsibility for the oversight of investments are challenged to stay abreast of the large array of investment techniques available to them.
Kevin McNulty, Chief Executive of the International Securities Lending Association, commented: “Ensuring that beneficial owners of securities, such as pension funds, have access to straightforward advice about securities lending remains an extremely important objective of ISLA. We are very pleased to work with Societe Generale Securities Services in developing these materials for the French marketplace. The documents complement the broader range of materials already in existence aimed at educating investors on securities lending and we hope to produce further versions for other markets shortly”.
Anne-France Demarolle, Head of Liquidity Management, Societe Generale Securities Services, added: “Societe Generale Securities Services is already an active player in securities lending, providing access to this source of revenue to a wide range of investors. We are pleased to team up with ISLA to further promote securities lending within the French-speaking investment community, enabling us to facilitate clients’ access to our service through our agent lending programme”.
The guide is based on English language versions of documents first produced in late 2010 by a group of leading financial trade associations, including ISLA. The French versions include an introductory guide and a checklist for investors who are contemplating starting securities lending programmes for the first time.
Securities lending is an investment technique which can generate incremental returns on portfolios of shares and bonds. Investors lend securities to borrowers, such as market makers and investment banks, who pay the lender a fee. Loans are secured with collateral and business is conducted under well-developed master agreements.
Whilst much has been written on the subject of securities lending, most of the materials available are aimed at readers with an existing degree of understanding of the business. Trustees and others with responsibility for the oversight of investments are challenged to stay abreast of the large array of investment techniques available to them.
Kevin McNulty, Chief Executive of the International Securities Lending Association, commented: “Ensuring that beneficial owners of securities, such as pension funds, have access to straightforward advice about securities lending remains an extremely important objective of ISLA. We are very pleased to work with Societe Generale Securities Services in developing these materials for the French marketplace. The documents complement the broader range of materials already in existence aimed at educating investors on securities lending and we hope to produce further versions for other markets shortly”.
Anne-France Demarolle, Head of Liquidity Management, Societe Generale Securities Services, added: “Societe Generale Securities Services is already an active player in securities lending, providing access to this source of revenue to a wide range of investors. We are pleased to team up with ISLA to further promote securities lending within the French-speaking investment community, enabling us to facilitate clients’ access to our service through our agent lending programme”.
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