Bolsa de Valores de Lima (BVL), along with Peruvian central securities depository, Scotia Bolsa, Citi Peru and pension fund manager, AFP Integra, has introduced a new securities lending platform in Peru.
The new platform will enable non-Peruvian investors to borrow and lend securities in Peru and make available an additional $4 billion in Peruvian stock to the market.
According to BVL, the platform enhances the Peruvian market depth, liquidity, and efficiency and provides clients with a greater opportunity to invest in Latin America.
Access to securities lending on the platform requires the services of a local broker-dealer, such as Scotia Bolsa, to execute the trade on behalf of the foreign broker.
Additionally, the platform includes a formal legal structure incorporating industry standard documentation, Peruvian Appendix to the Global Master Securities Lending Agreement (GMSLA).
This is an operating platform that allows for USD and equity collateral as well as full visibility into the Peruvian central securities depository’s Wari platform via Citi Peru’s custody and clearing services.
Miguel Ángel Zapatero, head of business of BVL, said: "Stock lending is a solution that complements efforts to boost local liquidity by facilitating price formation, channel funds back to the market, and attract new kinds of investors."
Jean Pierre Fournier Romero, CIO, equities, AFP Integra, noted: "We strongly believe that securities lending will provide more liquidity and alternatives to trade Peruvian assets."
Cristina León Jiménez, head of Scotia Bolsa, cited: “Scotia Sociedad Agente de Bolsa was instrumental in the development and subsequent testing of procedures for the enhanced model."
"Our objective was to meet the standards of both local and international clients while bringing the expertise of our global platform for the benefit of the market."
John Stracquadanio, head of US capital markets, prime services, collateral management and funding, and US equities at Scotiabank, commented: "Scotia Bolsa, the brokerage arm of Scotiabank Peru, worked directly with clients to build a securities lending offer that helps to maximise holdings of institutional investors."
Diego Castro, head of securities services, Citibank del Peru S.A., added: "This offering is the result of an outstanding collaborative effort from infrastructure providers to investors and intermediaries that facilitates non-domiciled investors access to market and contributes in developing the Peruvian capital market.”
