Investment Operations

Securities Lending and Borrowing

Categories Intermediate, Operations

Course Instructor

Course Level

Intermediate

Certification

8.0 CPE Credits

Delivery

Via Zoom

Hours (EST)

12:00pm - 4:00pm​

Description

*This course can also be offered upon request and can be customized to fit your team’s needs.

Date: April 29-30

The Securities Lending & Borrowing virtual training course is designed to provide a thorough understanding of the reasons for lending and borrowing securities and the sequential steps in processing SL&B transactions, with a focus on risk mitigation and enabling efficient processing. Following the course, each delegate will be equipped to apply all concepts to whichever part of the processing lifecycle for which they are responsible. The objectives of the course are for delegates to appreciate and understand:

  1. the purpose and benefits of lending & borrowing securities
  2. the participants in securities lending & borrowing
  3. the purpose of legal agreements
  4. the methods of lending & borrowing securities
  5. the securities lending & borrowing processing lifecycle
  6. the purpose of collateral in securities lending & borrowing
  7. the fees that can be earned via securities lending
  8. the impact of income and corporate actions on lent & borrowed securities

Who Should Attend 

The Securities Lending and Borrowing course is suitable for existing employees that would benefit from a broader understanding of securities processing. The course contains essential concepts that all securities operations personnel should be aware of, such as why securities are lent, the specific circumstances that give rise to securities borrowing, the circumstances under which lent/borrowed securities can be recalled, and who benefits when income and corporate actions arise on lent/borrowed securities.

Prerequisites: Delegates should possess a thorough understanding of basic securities operations concepts and the securities trade lifecycle prior to attending this course; please refer to the Securities Operations Fundamentals course and the Securities Trade Lifecycle course.

Day 1

Fundamental SL&B Concepts
  • Nature of the Trade
  • Introduction to Securities Lending
  • Introduction to Securities Borrowing
  • Primary Characteristics of an SL&B Trade
SL&B Trade Lifecycle: Overview
  • Legal Documentation
  • Trade Execution
  • Opening Leg Settlement
  • Exposure Calculation
  • Margin Calls
  • Recall/Return of Lent Securities
  • Closing Leg Settlement
  • Settlement of Fees
SL&B Marketplace Participants
  • Introduction
  • The Lender Community
  • The Borrower Community
  • SL&B Intermediaries
The Lender’s Perspective
  • The Motivation to Lend
  • Considerations When Lending
The Borrower’s Perspective
  • The Motivation to Borrow
  • Considerations When Borrowing
SL&B and Legal Documentation
  • Reasons for Legal Protection
  • The GMSLA
  • Securities Lending Agency Agreement
  • The GMRA
Characteristics of The Lent/Borrowed Security
  • Characteristics of Equity
  • Characteristics of Bonds
  • Lent Equity versus Lent Bonds

Day 2

SL&B and Associated Collateral
  • Fundamental Collateral Concepts
  • Margin: Purpose & Use
  • Types of Collater
  • Collateral and SL&B Fees
The SL&B Trade Lifecycle
  • Introduction
  • Pre-Trading
  • Trade Execution
  • Pre-Settlement
  • Settlement of Opening Leg
  • Throughout the Lifetime of Trade
  • Recall and Return of Securities
  • Settlement of Closing Leg
  • Settlement of Fees and Rebates
The SL&B Trade Lifecycle Simulation
Updating Books & Records
  • Securities Bookkeeping: Definition & Purpose
  • Essential Securities Bookkeeping Concepts
  • Importance of Updating Books & Records
  • Updating B&R for Lent/Borrowed Securities
  • Updating B&R for Non-Cash Collateral
  • Updating B&R for Cash Collateral
  • Updating B&R for Fees & Rebates
Accessing the SL&B Marketplace
  • Bilateral Lending & Borrowing
  • ICSDs: Failed Trades Management
  • ICSDs: Tri-Party Agent
  • Global Custodians
  • Third-Party Lending Agents
  • Central Counterparties
SL&B and Corporate Actions
  • Introduction to Corporate Actions
  • Corporate Actions Lifecycles: Overview
  • Treatment of Income: Cash Dividends
  • Entitlement to Income on Lent Securities
  • Treatment of Income: Short Selling of Equity
  • Treatment of Income: Lent/Borrowed Equity
  • Treatment of Income: Equity Collateral
  • Treatment of Income: Lent Bonds & Bond Collateral
  • Treatment of Voting Rights
  • Treatment of Withholding Tax
SL&B and Regulation
  • Introduction
  • EU Financial Transactions Tax
  • Reporting to a Central Trade Repository
Risks in SL&B
  • Risks: Lender’s Perspective
  • Risks: Borrower’s Perspective
Summary & Questions

In-House Training

Custom Training can help you achieve your corporate training goals while staying on budget and focusing the content on the needs of your group. Email your questions regarding corporate training to training@investmentoperations.net.

2023 Training Calendar

Training Catalogue

Course Instructor

Course Level

Intermediate

Certification

8.0 CPE Credits

Delivery

Via Zoom

Hours (EST)

12:00pm - 4:00pm​

Description

*This course can also be offered upon request and can be customized to fit your team’s needs.

Date: April 29-30

The Securities Lending & Borrowing virtual training course is designed to provide a thorough understanding of the reasons for lending and borrowing securities and the sequential steps in processing SL&B transactions, with a focus on risk mitigation and enabling efficient processing. Following the course, each delegate will be equipped to apply all concepts to whichever part of the processing lifecycle for which they are responsible. The objectives of the course are for delegates to appreciate and understand:

  1. the purpose and benefits of lending & borrowing securities
  2. the participants in securities lending & borrowing
  3. the purpose of legal agreements
  4. the methods of lending & borrowing securities
  5. the securities lending & borrowing processing lifecycle
  6. the purpose of collateral in securities lending & borrowing
  7. the fees that can be earned via securities lending
  8. the impact of income and corporate actions on lent & borrowed securities

Who Should Attend 

The Securities Lending and Borrowing course is suitable for existing employees that would benefit from a broader understanding of securities processing. The course contains essential concepts that all securities operations personnel should be aware of, such as why securities are lent, the specific circumstances that give rise to securities borrowing, the circumstances under which lent/borrowed securities can be recalled, and who benefits when income and corporate actions arise on lent/borrowed securities.

Prerequisites: Delegates should possess a thorough understanding of basic securities operations concepts and the securities trade lifecycle prior to attending this course; please refer to the Securities Operations Fundamentals course and the Securities Trade Lifecycle course.

Day 1

Fundamental SL&B Concepts
  • Nature of the Trade
  • Introduction to Securities Lending
  • Introduction to Securities Borrowing
  • Primary Characteristics of an SL&B Trade
SL&B Trade Lifecycle: Overview
  • Legal Documentation
  • Trade Execution
  • Opening Leg Settlement
  • Exposure Calculation
  • Margin Calls
  • Recall/Return of Lent Securities
  • Closing Leg Settlement
  • Settlement of Fees
SL&B Marketplace Participants
  • Introduction
  • The Lender Community
  • The Borrower Community
  • SL&B Intermediaries
The Lender’s Perspective
  • The Motivation to Lend
  • Considerations When Lending
The Borrower’s Perspective
  • The Motivation to Borrow
  • Considerations When Borrowing
SL&B and Legal Documentation
  • Reasons for Legal Protection
  • The GMSLA
  • Securities Lending Agency Agreement
  • The GMRA
Characteristics of The Lent/Borrowed Security
  • Characteristics of Equity
  • Characteristics of Bonds
  • Lent Equity versus Lent Bonds

Day 2

SL&B and Associated Collateral
  • Fundamental Collateral Concepts
  • Margin: Purpose & Use
  • Types of Collater
  • Collateral and SL&B Fees
The SL&B Trade Lifecycle
  • Introduction
  • Pre-Trading
  • Trade Execution
  • Pre-Settlement
  • Settlement of Opening Leg
  • Throughout the Lifetime of Trade
  • Recall and Return of Securities
  • Settlement of Closing Leg
  • Settlement of Fees and Rebates
The SL&B Trade Lifecycle Simulation
Updating Books & Records
  • Securities Bookkeeping: Definition & Purpose
  • Essential Securities Bookkeeping Concepts
  • Importance of Updating Books & Records
  • Updating B&R for Lent/Borrowed Securities
  • Updating B&R for Non-Cash Collateral
  • Updating B&R for Cash Collateral
  • Updating B&R for Fees & Rebates
Accessing the SL&B Marketplace
  • Bilateral Lending & Borrowing
  • ICSDs: Failed Trades Management
  • ICSDs: Tri-Party Agent
  • Global Custodians
  • Third-Party Lending Agents
  • Central Counterparties
SL&B and Corporate Actions
  • Introduction to Corporate Actions
  • Corporate Actions Lifecycles: Overview
  • Treatment of Income: Cash Dividends
  • Entitlement to Income on Lent Securities
  • Treatment of Income: Short Selling of Equity
  • Treatment of Income: Lent/Borrowed Equity
  • Treatment of Income: Equity Collateral
  • Treatment of Income: Lent Bonds & Bond Collateral
  • Treatment of Voting Rights
  • Treatment of Withholding Tax
SL&B and Regulation
  • Introduction
  • EU Financial Transactions Tax
  • Reporting to a Central Trade Repository
Risks in SL&B
  • Risks: Lender’s Perspective
  • Risks: Borrower’s Perspective
Summary & Questions

In-House Training

Custom Training can help you achieve your corporate training goals while staying on budget and focusing the content on the needs of your group. Email your questions regarding corporate training to training@investmentoperations.net.

2023 Training Calendar

Training Catalogue

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