Rates volatility unlikely to dampen demand for securities lending

Securities lending enjoyed a good year in 2021 and, despite the prospect of rate hikes, corporate M&A activity offers cause for optimism for 2022.

The global securities lending industry generated $9.3 billion in revenue for lenders in 2021, an increase of more than 21% compared with the previous 12 months, according to DataLend.

Broker-to-broker activity – where broker-dealers lend and borrow securities from each other – generated an additional $2.8 billion.

It was a welcome result after a couple of years where revenues were negatively impacted by factors such as short-selling bans and the global pandemic.

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Michael Saunders, BNP Paribas Securities Services

The revenue performance reflects, among other things, the impact of retail participation during the last year.

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