Markit calls for securities lending overhaul
07 March 2019 London
Image: Shutterstock
IHS Markit, in conjunction with the International Securities Lending Association (ISLA), are launching an industry-wide working group with the aim of issuing a global Securities Lending Performance Measurement charter.
In a report, published by ISLA, Paul Wilson of IHS Markit suggested that the “lack of trust and use of Securities Lending Performance Measurement calls for overhaul and modernisation”.
The aim is to complete the work by Q3 2019 but allow some flexibility around adoption given the implementing Securities Finance Transactions Regulation implementation and potential development work.
Wilson explained in the report that the securities lending industry has dramatically evolved and has managed to continue adjusting itself to a variety of challenges.
However, not much has changed with Securities Lending Performance Measurement in keeping pace or staying in line with the structural customisation developments.
Wilson suggested that this has led to a common view from many beneficial owners that under the current approach “everyone seems to win”.
He suggested that having an industry-wide global standard, which all participants adhere to, will eliminate inconsistencies and lead to a far more trusted and utilised methodology.
Wilson concluded: “This is not about winners and losers—in fact, a fresh standardised approach will ensure all participants have a more accurate view of their respective programme performance.”
In a report, published by ISLA, Paul Wilson of IHS Markit suggested that the “lack of trust and use of Securities Lending Performance Measurement calls for overhaul and modernisation”.
The aim is to complete the work by Q3 2019 but allow some flexibility around adoption given the implementing Securities Finance Transactions Regulation implementation and potential development work.
Wilson explained in the report that the securities lending industry has dramatically evolved and has managed to continue adjusting itself to a variety of challenges.
However, not much has changed with Securities Lending Performance Measurement in keeping pace or staying in line with the structural customisation developments.
Wilson suggested that this has led to a common view from many beneficial owners that under the current approach “everyone seems to win”.
He suggested that having an industry-wide global standard, which all participants adhere to, will eliminate inconsistencies and lead to a far more trusted and utilised methodology.
Wilson concluded: “This is not about winners and losers—in fact, a fresh standardised approach will ensure all participants have a more accurate view of their respective programme performance.”
NO FEE, NO RISK
100% ON RETURNS If you invest in only one securities finance news source this year, make sure it is your free subscription to Securities Finance Times
100% ON RETURNS If you invest in only one securities finance news source this year, make sure it is your free subscription to Securities Finance Times
