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4 Securities Lending Market Report | H2 2024 5

Foreword

>>> Welcome you to the 22nd edition of ISLA’s Securities Lending Market Report.

Last year, I wrote about 2024 being the year that the world went to vote, and as I write this, there is no doubt that you,
like myself, will be watching the impact of those elections play out in real time.
While political priorities are still emerging, what is clear recent ESMA conference, where 69% of attendees were Alongside, new markets, we are also witnessing the
from the swathe of new executive orders in the US, the still unclear on the SIU’s priorities, with concerns that the emergence of new entrants, including retail investors,
number of ambitious papers being published in the EU, and plans could be too broad to deliver. fintech companies, and alternative constructs, such as
the clear change in political rhetoric globally, is that we are Although prudential regulation may be a point of neo-brokers in the securities lending market. While still
now in a very different place compared to only a year ago. nascent, I expect that with greater education, growth-
divergence, one area where there seems to be global
Already, President Trump has been very vocal about harmony is in the drive to accelerated settlement. 2025 aligned regulation, and the development of new technology
his ambition to boost the global competitiveness of will be the year that the UK and EU’s transition to T+1 alongside our markets constant search for new supply, that
the US banking sector. With many tools at his disposal, takes centre stage. While many will look at the US 2025 will be the year that these players come to the fore.
de-regulation will undoubtedly be a key lever; we have experience with a sense of comfort in the knowledge that Much of what I have written forms the basis of the
already seen an open debate on the future direction of the transition was relatively smooth, the EU is a much agenda at our upcoming 32nd Annual Securities Finance
developments in Basel III and 10c-1a. more complex proposition, with 11 currencies, 14 central & Collateral Management Conference in Madrid. During
counterparties, 34 Central Securities Depositories, and
Whatever direction the US administration decides to take, the event we will explore how firms can deploy economic
ramifications on other jurisdictions will be profound. In nearly 90 trading venues. With the date now set, industry- capital against the backdrop of themes such as T+1, Basel Andrew Dyson, CEO, ISLA
Europe, after many years of increased regulatory oversight, wide collaboration will be key, with associations such as III and operational resilience, locally, whilst also remaining
regulators need to balance this with the need to maintain ISLA at the heart of these discussions. competitive, globally. I hope to see many of you there!
competitiveness in an increasingly polarised world. Our advocacy strategy across the EU, UK and in the US
through ISLA Americas means we are able to influence In closing, I would also like to thank the team at Northern
The publication of the European Commission’s Trust for providing the market commentary for this report.
Competitiveness Compass shines some light on the on behalf of the industry and keep an open dialogue with
priorities for the new term, with a focus on three key members through our working groups. I would like to thank The support of our members has been invaluable to the Our advocacy strategy across the
pillars: closing the innovation gap, joint roadmap for our members for their invaluable contributions to these publication of these reports over the last decade.
decarbonization & competitiveness, and increasing security efforts. Finally, and by no means least, I would like to thank our EU, UK and in the US through ISLA
& reducing excessive dependencies. These pillars require Regulation can be deployed to achieve several outcomes, data partners - tri-party agents BNY, Euroclear, Clearstream,
funding, with the Savings and Investments Union (SIU) including growth. Equally, growth can come from increased and JP Morgan, as well as data firms DataLend, S&P Global, Americas mean we are able to
outlining a need to mobilise private sector resources and supply and liquidity, both of which can be realised through and FIS Global, for providing the underlying data, without influence on behalf of the industry
direct them towards future-oriented growth sectors, while the opening of new markets and fostering relationships which it would not have been possible to compile this
working toward regulatory simplification and coordination. with new trade partners, who themselves are searching report. and keep an open dialogue with
In principle, this should offer opportunities for our sector for growth. From new markets across EMEA, to the re-
but will not be without its challenges - as highlighted at a emergence of Asia, the opportunities are there. AD members, through our working
groups