Securities lending revenues up by 51% YoY during August

The revenue generated for lenders in August 2021 also represents an increase of 5% from July 2021.

By Wesley Bray

The global securities finance industry generated $796 million in revenue for lenders in August 2021, according to DataLend, the market data division of FinTech EquiLend, representing a 51% increase year over year.

The figure shows a 5% increase from the $756 million generated for lenders in July 2021.

Global broker-to-broker activity, which consists of broker-dealers lending and borrowing securities from each other, totaled $211 million in revenue in August, a 19% increase from 2020.

An increase in fees and balances in global equities drove the increase in lender-to-broker revenue over 2020, according to DataLend, with an exchange offer in EMEA and various high-profile 2021 IPOs and SPAC mergers still trading hot.

There was an increase in the average fee for global equities by over 20 basis points (bps) to 74 bps, while the average on-loan value increased by 16% compared to the previous year.

For fixed income securities, global revenue generated from government debt saw a 21% increase, while corporate debt increased by 44%.

Rises in the average on-loan value of 21% and 40% respectively, drove both revenues to increase.

Naspers N, Lucid group, Coupang, Robinhood Markets and iShares iBoxx $ High Yield Corporate Bond ETF were the top five earners in August 2021.

The five securities combined generated over $148 million in revenue in the month.