Securities lending auction platform eSecLending says it has completed an auction of approximately $76 billion in US equities for the California Public Employees Retirement System (CalPERS). Exclusive borrowing rights to the securities were auctioned on 3 May.
Four banks submitted winning principal bids. Citigroup Global Markets won the majority of assets and will retain exclusive borrowing rights to the portfolios for the term of the agreement. Goldman, Sachs, JP Morgan and Lehman Brothers also won exclusive rights to access portions of the funds. CalPERS also awarded a portion of the US equity assets to Metropolitan West Securities to lend on an agency basis.
We are very excited about the results of the recent US equity auction, says Dan Kiefer, Opportunistic Portfolio Manager for CalPERS. “The auction process has achieved tremendous returns for CalPERS securities lending program over the past 6 years. By actively managing our lending activities and continually re-auctioning the exclusive agreements, we were able to once again optimize our return which is expected to translate into another record earnings year for our securities lending programme.
Tom Tesauro, co-head of Equity Finance at Citigroup, adds that “our relationship with CalPERS demonstrates our continued commitment to provide our prime brokerage clients with the highest-quality service and products. We believe CalPERS’ superior pension assets are a terrific addition to our robust securities lending platform.