This is the first time European ETFs have been made available on an electronic lending platform, bringing together supply and demand into a single central marketplace. Currently, i-Sec facilitates screen-based access to securities lending in equities from France, Germany, Italy, The Netherlands, Spain, Sweden, Switzerland, the United Kingdom and Japan.

"This initiative is the result of strong demand from the ETF community, said Roy Zimmerhansl, Head of Securities Lending at ICAP. "We believe i-Sec offers an efficient distribution and access network for ETFs for the first time and that this will help drive further growth in the sector."

"The launch of ETFs on i-Sec will benefit both investors and traders by creating a more transparent and liquid ETF Securities Lending market," said Manooj Mistry, Head of Equity ETF Structuring, Deutsche Bank.

"ETF Investors can generate meaningful revenue from lending their positions. The centralised market for lenders and borrowers that i-Sec offers will make lending ETFs more efficient and scalable," said Andrea Morresi, Head of Sales, iShares Europe.

According to Deutsche Bank, turnover in European ETFs increased by 88 percent in 2007, with assets under management increasing 22 percent in the same time period. This escalation of interest from investors and traders has also generated further demand for borrowing ETFs, giving investors an opportunity to add incremental returns through lending their ETFs.

Electronic lending of ETFs has many benefits: through i-Sec, both borrowers and lenders can easily broadcast their search or available portfolio to a wider range of interested parties. The transparency of screen based trading on i-Sec, the visibility of market depth and the power of negotiating tools on the system help firms to gain optimal terms for their transactions.