IMN: Do lenders struggle to keep up with their clients?
12 September 2018 London
Image: Shutterstock
“Do securities lenders live by a vanilla-type business report?”, questioned one panellist at this year’s annual European Securities Finance and Collateral Management Conference.
During a session concentrating on critical issues heading the agendas of beneficial owners, the panellist questioned whether lenders struggle to keep up with their clients.
The panellist challenged the lenders on the panel suggesting that “the minute a client wants to step outside that norm, some of you struggle to keep up with that client”.
In answer to this comment, one panellist said: “There has been a legacy thought process in this business to standardise and push that standardisation through. There’s increasing agility in providers and across providers. We have the infrastructure, so we’re increasingly seeing clients coming to us around initial margin, where they need to generate cash on short notice.”
Another panellist stated: “Resources are scarce in most organisations, that said, we’ve got a pretty good record of being innovative. If you look at our business compared to some others, for example, when it comes to Securities Financing Transactions Regulation (SFTR), we are ahead of others and we’re quite good at doing that.”
The panellist explained that one reason for this aforementioned struggle to “keep up with the client”, may be the increasing level of regulatory compliance, as well as the need to keep up with the speed of technological innovation.
They added: “There’s so much going on with emerging technology now, we’re spending a huge amount of time around innovation. We’re looking at a lot of technology solutions for things like peer-to-peer lending.”
One panellist compared the level of innovation available before the financial crisis to now, stating: “In terms of innovation, [in the context of] the financial crisis 10 years ago, lending programmes, across the board, then and now, are hugely different.”
They added: “That one size fits all concept has hugely disappeared. We have had to be very innovative and flexible to meet all those needs, provide those services, be flexible and keep the beneficial owner community happy.”
Another said: “Times have changed–we understand a borrower's perspective more now than perhaps we may have 20 to 30 years ago.”
Panellists spoke of regulations that would ensure a financial crisis, such as the 2007-8 financial crisis, would not happen again.
One panellist said: “The second Markets in Financial Instruments Directive has forced various execution policies and parameters—we try to be as transparent as possible and as an industry, we’re doing that all the more now.”
However, one panellist stated: “Even though we now have a very good framework for reporting, SFTR doesn’t necessarily cover everything our clients ask about–surprisingly.”
During a session concentrating on critical issues heading the agendas of beneficial owners, the panellist questioned whether lenders struggle to keep up with their clients.
The panellist challenged the lenders on the panel suggesting that “the minute a client wants to step outside that norm, some of you struggle to keep up with that client”.
In answer to this comment, one panellist said: “There has been a legacy thought process in this business to standardise and push that standardisation through. There’s increasing agility in providers and across providers. We have the infrastructure, so we’re increasingly seeing clients coming to us around initial margin, where they need to generate cash on short notice.”
Another panellist stated: “Resources are scarce in most organisations, that said, we’ve got a pretty good record of being innovative. If you look at our business compared to some others, for example, when it comes to Securities Financing Transactions Regulation (SFTR), we are ahead of others and we’re quite good at doing that.”
The panellist explained that one reason for this aforementioned struggle to “keep up with the client”, may be the increasing level of regulatory compliance, as well as the need to keep up with the speed of technological innovation.
They added: “There’s so much going on with emerging technology now, we’re spending a huge amount of time around innovation. We’re looking at a lot of technology solutions for things like peer-to-peer lending.”
One panellist compared the level of innovation available before the financial crisis to now, stating: “In terms of innovation, [in the context of] the financial crisis 10 years ago, lending programmes, across the board, then and now, are hugely different.”
They added: “That one size fits all concept has hugely disappeared. We have had to be very innovative and flexible to meet all those needs, provide those services, be flexible and keep the beneficial owner community happy.”
Another said: “Times have changed–we understand a borrower's perspective more now than perhaps we may have 20 to 30 years ago.”
Panellists spoke of regulations that would ensure a financial crisis, such as the 2007-8 financial crisis, would not happen again.
One panellist said: “The second Markets in Financial Instruments Directive has forced various execution policies and parameters—we try to be as transparent as possible and as an industry, we’re doing that all the more now.”
However, one panellist stated: “Even though we now have a very good framework for reporting, SFTR doesn’t necessarily cover everything our clients ask about–surprisingly.”
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