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SECURITIES BORROWING & LENDING
 

CIMB Investment Bank has been approved by Bursa Securities to be a Lending Agent and Borrower and we have successfully lent out shares to other market participants. At CIMB, we add value by helping clients earn incremental income on their Securities Borrowing and Lending (SBL) activities, while simultaneously managing our SBL program to mitigate any risk. The SBL desk is internally managed and features teams of professionals dedicated to client service, compliance, operations, system and risk management.

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Market Mechanics

Bursa SBL system operates on the Central Lending Agent (CLA) framework
Bursa Securities assumes the role of CLA
Bursa will borrow from lenders and onward lend to Borrowers
It manages the “lending pool” and please click to view the pool.
   

Advantage

The benefit of Bursa Securities being the CLA:
Guarantee the fulfillment of all SBL transactions
Provide a central location for the borrower to identify targeted securities for borrowing
Manage risk associated with the borrowings
Provide a hub for all information pertaining to SBL
   

Eligible Securities

List of Eligible Securities permitted for Regulated Short Selling(RSS)/SBL
   

Loan Tenure and Requirement

All SBL loans is based on open tenure
It does not have any expiration or maturity
All loans may be terminated at any time by lenders recalling or borrowers returning the loaned securities
The minimum loan tenure for SBL is 1 (one) market day
The minimum quantity for lending is 50,000 units
The minimum borrowing quantity is set at 100 shares
   

Regulated Short Selling

All borrowers are required to open a designated Regulated Short Selling (RSS) Trading account
All securities borrowed will be credited into this designated account except for potential fail trade
RSS is only allowed to be executed on up tick rule
RSS trades are limited to 10% of paid up capital of a particular securities per day
RSS activities for that particular securities would be suspended for 1 (one) trading cycle once the limit is breached
Usage of designated RSS account adds greater transparency and allows close monitoring

Lenders

The major incentive is the stable fee income generated by otherwise idle asset
Represents efficient portfolio management
  

Borrowers

Complements a larger trading strategy, typically designed to profit from perceived pricing discrepancies between related securities
Provides avenue for hedging

Market Practice

All borrowers are required to place collateral with the Authorized Borrowers
Initial and maintenance margin is set at 110% and 105% respectively
All loaned positions and collateral will be marked to market daily
  

Permitted Collateral

Cash
Bank Guarantee by approved financial institutions
Bursa Securities quoted securities subject to hair cut
Foreign currencies

CIMB SBL Fee Structure:

Type of Fee
Bursa
CIMB
(% or Amount)
CDS A/C Opening FeeRM10.00RM20.00
Administrative FeeNilRM30.00
Processing Fee per Matched TradeRM100.00Bursa + RM20.00
Borrowing Fee2.20% Bursa + CIMB Spread
Penalty Fee1.00%1.00%

Lenders

Letter of Appointment of Lending Agent
Application to be Approved as a Lending Participant (Prescribed form:TAC010)
Application for Opening of Account (Prescribed form:SBL010)
Criteria for Board Resolution on Opening of SBL Lending Account
Criteria for Board Resolution for Appointment of Lending Agent
  

Borrower

Application for Securities Borrowing and Regulated Short Selling Form
SBL Borrowing Terms & Conditions
Criteria for Board Resolution on Opening of SBL Borrowing and RSS Trading Account
  

Other Supporting Documents (Applicable for both Lender and Borrower)

Certificate of Incorporation
Memorandum & Articles of Association
Form 24 (or latest Annual Return)
Notification of Situation of Registered Office (Form 44)
List of Company’s Directors (Form 49)
Latest Financial Report
Please click on the relevant links for regulatory updates.
Bursa SBL Circulars
Securities Commission
There is no announcement at the moment.

Thank you for your interest in CIMB Securities Borrowing & Lending. Please contact us through our numbers or emails for information, feedback or enquiries:

Feedback / General InquiriesTelephoneEmail
Karu Ramesh Kumar603 2732 2158karu.karuppiah@cimb.com
Khairul Azhar Isa603 2084 9602khairulazhar.isa@cimb.com