A new association representing the interest of the Canadian securities lending industry — the Canadian Securities Lending Association (CASLA) — was officially launched on Monday.
The group is a combined creation of CIBC Mellon, Northern Trust, RBC Dexia and State Street Corporation — the four firms that dominate securities lending in Canada.
The co-founding companies issued a joint statement, reading: “This is a major step forward in the continuing development of the Canadian securities lending market. We are pleased that our industry now has a collective voice in Canada and will continue to develop strong linkages with similar global associations.”
CASLA will use that voice to help educate the public on this sector of the industry, and will work with regulators to develop an efficient and secure marketplace. The group will also develop a set of best practices.
“Securities lending plays an integral role in today’s financial markets by providing greater liquidity, more efficient price discovery and opportunities for institutional investors to earn additional portfolio income,” said Rob Chiuch, executive director and head of trading at CIBC Mellon. “CASLA will work with all market participants to encourage the adoption of global best practices, enhance market transparency and ensure the long-term viability of securities lending in Canada.”
By the end of 2008, the Canadian industry had $886 billion worth of securities available for lending and $119 billion on loan.
CASLA is the first association to represent participants in the securities lending market — including custodian banks, beneficial owners, asset managers and broker-dealers. It will soon begin a membership drive, and hold executive elections in 2010.
While the first of its kind in Canada, a handful of regional associations already exist around the world, including the Risk Management Association (RMA) in the U.S., the International Securities Lending Association (ISLA) in Europe, Pan Asian Securities Lending Association (PASLA) and the Australian Securities Lending Association (ASLA).
“As a local organization, CASLA will develop solutions that are suited to Canada’s legal and regulatory framework, and make sense for this marketplace,” said Dave Sedman, manager, global securities lending at The Northern Trust Company, Canada Branch.
“CASLA is designed to give the industry a unified voice specific to the Canadian legal and regulatory framework, with the involvement of all market participants,” said Mark Fieldhouse, director of technical sales at RBC Dexia. “The establishment of a forum where regulators and stakeholders can address pertinent issues will play an important part in the further successful evolution of Canada’s vibrant securities lending market.”
 | Filed by Steven Lamb, Advisor.ca, steven.lamb@advisor.rogers.com |
(04/27/09)