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Citi has partnered with fintech firm Sharegain to launch a custody services-facing securities lending solution.
Designed for the global wealth management firms that Citi caters to, the fully automated securities lending solution means clients will not have to develop an internal programme themselves.
Sharegain’s technology allows customers of wealth management firms to decide on the securities they wish to lend, set the terms of the loan, and recall the security at any time.
While holders of securities can earn additional revenue on their stocks, bonds and exchange-traded funds, it is usually only viable for large financial institutions, such as asset managers, due to economies of scale, high costs and the complexity of implementation.
The solution is designed to integrate with existing IT infrastructure and provides a fully digital user experience, providing the information and controls needed to manage portfolios.
As the result of a partnership between Citi Ventures and Citi’s Agency Securities Lending business in Asia Pacific, the solution — born out of strategic growth programme Citi Ventures D10XSM — opens up opportunities for smaller players.
The Singapore-headquartered D10x team collaborated closely with Citi’s ASL business in prototyping, testing and launching the product.
Citi Ventures’ head of programs and strategic partnerships Victor Alexiev says: “This is a stellar example of business-aligned product innovation and cross-franchise cooperation which brings out the best in the depth and breadth of Citi's products and service offerings.
“Wealth and retail clients in Asia have traditionally been experienced investors and the demand from them for products that are largely only available to the institutional market, such as securities lending, is expected,” Alexiev adds.
Citi’s Asia Pacific head of agency securities lending Eusebio Sanchez says: “We are delighted to have brought this solution to market in collaboration with Sharegain and our wealth management clients, providing private investors access to the securities lending markets and thus, levelling the playing field.”
Sharegain CEO Boaz Yaari says: “We are excited to work with Citi to bring this first-of-its-kind solution to their clients and to set a new standard for our industry. This collaboration is a testament to the power of Sharegain’s solution and its potential to democratise securities lending.”
The automated lending solution comes after Sharegain launched BetterLend earlier this week. The new platform supports social and environmental causes through securities lending activity, allowing clients to assign a percentage of lending revenue to up to four social and environmental initiatives.
