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Securities Lending Market Report | December 2022

United States

>>> Equities

Throughout H2 2022, US Equity specials dominated the US equity markets, remaining substantial contributors to the
overall securities lending revenues. Utilisation remained strong, while average fees increased in comparison to 2021
according to market data providers.

Fig 5 - S&P Global

North American Equity Market

17.50 0.90
Lendable Value (Trillions $) 16.00 0.60 On-Loan Value (Trillions $)
17.00
0.80
0.70
16.50
0.50
15.50
0.40
15.00
0.30
14.50
0.20
14.00
13.50
0.00
13.00
Jul 2022 Aug 2022 Sep 2022 Oct 2022 Nov 2022 Dec 2022 0.10
Group Lendable On-Loan Balance

Energy showed to be the best performing sector of H2 Despite US equity revenues increasing in H2 2022, the growth Similar to the EV and energy sectors, the bio-tech sector Demand for Exchange Traded Funds (ETFs) eased throughout
2022, while the utility sector also showed substantial gains. was centered upon long standing meme stocks like Gamestop also displayed signs of elevated demand. One name that has H2 2022 despite a rather volatile market. The elevated demand
Halliburton Company, a corporation that provides energy and Corp. and AMC Entertainment Holdings Inc., as well as a contributed to the overall demand in the equity market in H2 for ETFs in the first half of 2022 with nearly 30% utilisation
manufactures products for the energy industry, saw its shares handful of select companies linked to electric vehicles, like 2022 was Janux Therapeutics Inc., a dominant name in the eased as specific geopolitical risk waned. Demand for ETFs
go up almost 36% during the last 3 months of 2022. During the Lucid Group Inc. Lucid Group Inc. was one of the top revenue biotech sector, which submitted an application to the U.S. Food linked to politically sensitive regions such as Turkey, Taiwan,
second half of the year, the company announced its initiative generating stocks of 2022 and dominated the Electric Vehicles and Drug Administration (FDA) for an investigational new drug, Russia and Malaysia counter-balanced the ease in demand to
in manufacturing advanced technological products that will (EV) sector. The attractiveness of the EV sector mostly derived which is in development to treat aggressive EGFD-expressing highlight material value in the financing markets. Additionally,
promote enhanced safety and reduce carbon footprint for from interest rates rising, as car manufacturing financing solid tumors. The company is seeking to start a trial of the drug ETFs linked to credit exposure also experienced increased
cementing activities, while also focusing on producing more became more expensive, which in turn has the ability to affect (JANX008) on humans in 2023. demand. ETFs focused on short duration, liquidity management
efficient and advanced drilling equipment. Targa Resources the overall demand. Moreover, competition grew significantly The massive decline of initial public offerings removed a great or credit (leveraged loans, high yield) also had elevated levels of
Corp. also contributed to the substantial gains seen in H2 2022, within the sector and the trend is projected to continue well deal of revenue opportunities for beneficial owners. The US IPO utilisation and increased fees as the impact of higher interest
as it was announced that the Daytona NGL Pipeline will move into 2023, as many traditional automobile makers are focusing activity was significantly lower in 2022 relative to 2021. The rates on the consumer and corporate treasury groups ability to
its natural gas liquids and link to Targa’s Grand Prix NGL Pipeline their manufacturing on EVs, like Fisker Inc., which generated market witnessed approximately 149 IPOs in 2022, a reduction manage higher interest rates was called into focus.
in North Texas. high borrower revenues at the end of H2 2022. of nearly 84% when compared to the 908 IPOs launched in

As the year progressed, by Q4, software became an attractive 2021. The impact of higher interest rates and tighter financial
sector and one of the most shorted sectors in American conditions also caused a material reduction in Special Purpose
equities. Microstrategy Inc., a stock that dominated not only Acquisition Companies (SPAC) offerings in 2022. A total of 78
the software sector, but H2 2022, remained under surveillance SPAC IPOs hit the market in 2022, a significant reduction from
due to the collapse of the crypto exchanges and the continued 444 deals in 2021, serving as a testament to the economic
uncertainty surrounding the crypto market. headwinds facing the market.