Professional Documents
Culture Documents
Securities
lending and
short selling
are a twopart market
reform aimed
at enhancing
market depth,
liquidity and
efficiency.
Accounting
Taxation
Recall Process/Buy-ins
Local Reporting
As with any financial transaction, practitioners undertaking securities
lending in the emerging markets should take into account a variety of legal
and tax considerations. For example, when a stock is lent in the market, is it
considered a disposal for tax purposes? And when manufactured dividends
as opposed to regular dividends are received by the lender, is there any
difference in the tax treatment?
The Future
Financial globalization will continue its steady
march toward greater trading volumes and
deeper integration. As history has shown,
frontier and emerging market practice and
standards will, over time, come to more closely
resemble those of developed markets. As the
worldwide securities lending industry expands
in depth and geographic coverage, lenders
and borrowers should look to market-leading
agent lenders to monitor this complex global
environment and guide activities through new
channels as they open up. As with other areas
of financial markets, the expanded adoption
of best practices and increased regulatory
harmonization can be expected to result
in deeper, more liquid and more efficient
capital markets for the benefit of all market
participants.
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