23 October 2017
Register now

Old Mutual introduces Web auctions for securities lending

03 November 2000  |  568 views  |  0 Old Mutual introduces Web auctions for securities lending

London-based asset manager Old Mutual has joined with the California Public Employees' Retirement System (Calpers) to establish eSecLending, a joint venture company offering a Web-based auction system for securities lending.

The new process is designed to meet the needs of large pension funds, mutual funds and other major investors including online custodians, says Old Mutual.

Calpers and eSecLending have successfully held their first auction by telephone, during which they beta tested the Web site software. Based on this early experience, Calpers believes it can nearly double the annual return it has previously earned from its securities lending activities. Investment management firms within the Old Mutual family of companies are expected to join Calpers in subsequent auctions.

Calpers, a minority partner in eSecLending, is the largest public pension fund in the US. Other large pension funds will be invited to participate in subsequent online auctions, says Old Mutual.

ESecLending says it auction system will aim to:
* bring together lenders, borrowers and brokers in one place via the web;
* allow price discovery by utilising a multiple-stage bidding process and offering lendable securities packaged in discrete tranches; and
* capture a large centralised pool of data on securities lending performance that will be used for a comprehensive benchmarking system.

"Securities lending currently takes place in a very inefficient marketplace," says Ty Danco, president of eSecLending. "We intend to change this through an auction process that offers clear benefits to lenders and borrowers."

Agents such as large custodian banks have historically served as middlemen in securities lending, taking a negotiated portion of the income generated in the lending process. The size of the securities lending market is estimated at between $1.5 trillion and $2 trillion worldwide.


Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

FDIC to pilot Internet-based asset auction

FDIC to pilot Internet-based asset auction

22 September 2000  |  3211 views  |  0 comments

Related blogs

Create a blog about this story (membership required)
visit www.innotribe.comvisit www.atos.netvisit www.niceactimize.com

Top topics

Most viewed Most shared
Mastercard to roll out blockchain APIMastercard to roll out blockchain API
19376 views comments | 28 tweets | 42 linkedin
HSBC partners Bud for open banking trialHSBC partners Bud for open banking trial
15170 views comments | 23 tweets | 32 linkedin
Sibos 2017: API or the highwaySibos 2017: API or the highway
10982 views comments | 12 tweets | 23 linkedin
Eight banks form joint venture to launch blockchain trade platformEight banks form joint venture to launch b...
9028 views comments | 14 tweets | 28 linkedin

Featured job

Competitive base, double ote, benefits
London, UK

Find your next job