The FIX Trading Community has published guidance for electronic securities lending, covering workflows for bilateral contracts and transactions involving a venue.
The guidance builds on earlier practices covering US equities, corporate bonds and DTC-eligible DVP US cash collateral contracts. It also includes workflows for quote negotiation, last look and free-of-payment (FOP) lending.
According to FIX Executive Director Jim Kaye, the working group included buy- and sell-side firms, vendors and venues. The aim was to develop a common messaging framework across different routes to market.
“Securities lending is fundamental to the smooth functioning of markets,” Kaye said, noting its role in areas including hedging and collateral management.
Fidelity Investments’ Yuri Brightly said the guidelines provide “a shared framework for electronic securities lending”, while Provable Markets’ Rachel Andreassian called a common protocol “a prerequisite for a healthy market structure.”
