Repo and Securities Lending

Price: $995   Register now

Recommended that you register at least two weeks in advance.

Course Features

  • Course date:02/11/2020
  • Course Duration: 1 Day
  • Level: Beginner
  • Prerequisites: Knowledge of CM
  • Method: Live & Virtual
  • Venue: MicroTek
  • Time: 9:00 am – 5:00 pm
  • Dress Code: Business Casual

Repo and Securities Lending

This one-day course provides the fundamentals of a business that has experienced record levels of growth, producing a critical source of revenue for both the buy-side and the sell-side of financial industry. It is intended for an audience who is interested in learning the basics of the securities lending business, including the motivation of participants, transaction types and the lifecycle of a securities lending deal, while highlighting associated areas of risk.

The main types of securities lending transaction activity will be covered, including stock borrow/loan, repo/reverse repo, tri-parties, and dollar rolls.  Participants will gain perspective on the historical evolution of this market and its place in the financial markets from the perspective of a broker/dealer.

The role of broker/dealers, institutions, custodians, prime brokers and industry organizations such as clearing houses and depositories will be examined.

Course Objectives:

By the end of this session participants will be able to:

  • Understand the financial context for repo and securities lending and the motivation of participants
  • Explain the types of repo and securities lending transactions
  • Describe the lifecycle of a securities lending transaction: how stock loan and repo transactions are executed, confirmed, cleared and settled
  • Analyze the function of collateral management for securities lending
  • Identify areas of credit, market and operational risk

Session 1 –  Overview of the Repo and Securities Lending business 

  • Why it exists and its historical evolution
  • Motivation of participants: broker/dealers, investment managers, institutions, custodians, hedge funds, and prime brokers
  • Reasons for borrowing and lending cash and securities
    • Short selling – lifecycle of a short sale and the role played by securities lending
    • Arbitrage Trading Strategies
    • Fail coverage
    • Using securities lending for funding and trade financing
    • How securities lending is used to enhance yield
    • Running a matched-book business
  • Importance of special and general collateral

Session 2 – Types of securities lending transactions

  • Equity Securities Lending
  • Repo’s
    • Bilateral
    • Tri-Party
    • GCF
  • Dollar Rolls

 Session 3 – Lifecycle of a Repo and Securities Lending Transaction

  • Master Repo and Securities Lending Agreements
  • Principal vs Agency arrangements
  • Origination, trading and sources of liquidity
  • Electronic Trading Platforms
  • Finding a counterparty: agents and intermediaries
    • Counterparty Risk Management Considerations
    • Available Inventory and portfolios
    • Rebate/Fee Negotiations
  • Confirmations of Repos and Securities Lending transactions
  • Settlement Transfer of securities and cash
    • What happens while the loan is opened
    • Income and Corporate Action Events
    • Voting Rights and other entitlements
  • What types of repos and securities lending transactions are subject to clearing
  • The role of the Clearing Bank, the FICC (Fixed Income Clearing Corporation), and the OCC (Options Clearing Corporation)
  • Loan Recall Process
  • Associated fails and their implications in securities lending transactions
  • Payment of rebates and fees

Session 4- Collateral Management

  • Types: Cash and Securities
  • Collateral Optimization
  • Hair-cuts and how they are determined
  • Collateral substitutions
  • Collateral Eligibility profiles
  • Segregation of Assets vs Hypothecation
  • Collateral Transformation

Session 5 – Risk Management in the Repo and Securities Lending Markets

  • Identification and management of counterparty credit risk
  • Mitigation of market risk
  • Gaps and exposure that creates operational risk


  • Charlotte is a broadly accomplished financial services executive with over 25 years of comprehensive experience in delivering innovative and cost-effective operations and technology training solutions for equities, derivatives and fixed income product lines.  Her successful career as a senior-level manager in Operations at Credit Suisse, Paine Webber and Bankers Trust furnishes the industry expertise that …
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