Securities lending revenues down 9% YoY for August
03 September 2024 Global
Image: Naypong_Studio/stock.adobe.com
Securities lending activity generated US$1.007 billion in revenues during August, representing a 9 per cent year-on-year (YoY) decrease, according to S&P Global Market Intelligence.
In the firm’s snapshot for August revenues, balances increased 6 per cent YoY across all securities as asset prices recovered throughout the month.
Average fees decreased by 15 per cent YoY to 44 basis points across all securities, with only ADRs showing a YoY increase (11 per cent).
Across the equity markets, declines in revenues were seen across all regions, with Americas equities experiencing the largest YoY fall of 17 per cent.
EMEA equity revenues were down 11 per cent YoY, while Asian revenues fell by 8 per cent YoY.
In addition, Equity revenues fell slightly when compared month-on-month as average fees also dipped.
In the fixed income markets, government bonds fared well, increasing YoY revenues again by 11 per cent. This was driven by a 14 per cent YoY increase in average balances as average fees declined by 4 per cent YoY.
Corporate bond revenues continued to experience YoY declines — down 13 per cent — with US$82 million being generated during the month of August.
Commenting on the snapshot, Matthew Chessum, director of securities finance at S&P Global Market Intelligence, says: “Securities lending revenues remained robust throughout the month despite the market volatility seen throughout the first week of August.”
He indicates that government bond revenues experienced their strongest month for over two years, as opportunities driven by divergence in interest rate policy started to play out across the financial markets.
Chessum concludes: “The short lived bout of volatility seen during the month seems to have had very little impact upon securities lending activity during the month, either positive or negative.
“The sudden correction and recovery did encourage a slight increase in ETF borrowing however which helped to increase monthly revenues for the asset class.”
In the firm’s snapshot for August revenues, balances increased 6 per cent YoY across all securities as asset prices recovered throughout the month.
Average fees decreased by 15 per cent YoY to 44 basis points across all securities, with only ADRs showing a YoY increase (11 per cent).
Across the equity markets, declines in revenues were seen across all regions, with Americas equities experiencing the largest YoY fall of 17 per cent.
EMEA equity revenues were down 11 per cent YoY, while Asian revenues fell by 8 per cent YoY.
In addition, Equity revenues fell slightly when compared month-on-month as average fees also dipped.
In the fixed income markets, government bonds fared well, increasing YoY revenues again by 11 per cent. This was driven by a 14 per cent YoY increase in average balances as average fees declined by 4 per cent YoY.
Corporate bond revenues continued to experience YoY declines — down 13 per cent — with US$82 million being generated during the month of August.
Commenting on the snapshot, Matthew Chessum, director of securities finance at S&P Global Market Intelligence, says: “Securities lending revenues remained robust throughout the month despite the market volatility seen throughout the first week of August.”
He indicates that government bond revenues experienced their strongest month for over two years, as opportunities driven by divergence in interest rate policy started to play out across the financial markets.
Chessum concludes: “The short lived bout of volatility seen during the month seems to have had very little impact upon securities lending activity during the month, either positive or negative.
“The sudden correction and recovery did encourage a slight increase in ETF borrowing however which helped to increase monthly revenues for the asset class.”
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