State Street Announces Expansion of Direct Access Lending
October 12 2021 - 8:30AM
Business Wire
Product will now include Convertible Bond Arbitrage
Strategies
State Street Corporation (NYSE: STT) today announced it has
expanded upon its market leading peer-to-peer securities finance
product, Direct Access Lending -- which enables direct, principal
loans between its lending clients and its borrowing clients – to
now allow borrowers to post US convertible bonds as collateral to
facilitate new clients and strategies entering the program. The
managed peer-to-peer product has grown substantially since product
launch in Q4 2019 adding both new lending clients and borrowing
clients to the US equity security lending program and steadily
increasing on-loan balances.
“Direct Access Lending has helped us continue to differentiate
from our competitors by providing our clients the cost benefits of
a peer borrowing model with the operational efficiencies received
from a prime broker,” said Martin Tell, global head of Securities
Finance. “In addition, providing our clients a peer option within
their Enhanced Custody program ensures stability as a trusted
financing counterparty. The feedback from our customers has been
very strong with the rollout of Direct Access Lending, and we’re
seeking to build upon the success we’ve had with this
expansion.”
To facilitate the new collateral type in Direct Access Lending,
State Street will leverage both its Agency Lending and Enhanced
Custody programs, each of which already accept US convertible bonds
as collateral, to offer both sets of customers the benefits of each
program required to operate in a peer-to-peer transaction while
also enjoying an economic benefit associated with Direct Access
loans. The same operational support provided today for
equity-for-equity loans in Direct Access Lending will be offered to
customers engaged in equity-for-convertible bond loans to allow an
increased economic opportunity for State Street clients without an
increase in operational risk or burden.
“We expect significant uptake from both existing and prospective
clients and are excited to continue building product capabilities
into our best in class peer-to-peer program,” added John McGuire,
State Street’s global head of Business Development for Securities
Finance.
State Street’s Global Markets team provides specialized
research, trading, securities finance and innovative portfolio
strategies to owners and managers of institutional assets. Its goal
is to enhance and preserve portfolio values for clients through
original flow-based research, proprietary portfolio and risk
management technologies that optimize trading.
About State Street Corporation
State Street Corporation (NYSE: STT) is one of the world's
leading providers of financial services to institutional investors
including investment servicing, investment management and
investment research and trading. With $42.6 trillion in assets
under custody and/or administration and $3.9 trillion* in assets
under management as of June 30, 2021, State Street operates
globally in more than 100 geographic markets and employs
approximately 39,000 worldwide. For more information, visit State
Street's website at www.statestreet.com.
*Assets under management as of June 30, 2021 includes
approximately $64 billion of assets with respect to SPDR® products
for which State Street Global Advisors Funds Distributors, LLC
(SSGA FD) acts solely as the marketing agent. SSGA FD and State
Street Global Advisors are affiliated.
© 2021 State Street Corporation - All Rights Reserved
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Media: Brendan Paul Bpaul2@statestreet.com +1 401 644
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