FSC to relax securities borrowing, lending rules next year

Taiwan News
Date: 2015-07-15
By: Central News Agency

Taipei, July 15 (CNA) The Financial Supervisory Commission (FSC), the top financial regulator in Taiwan, said Wednesday that it will relax rules on the securities borrowing and lending (SBL) mechanism starting on Jan. 1, 2016 in a bid to further boost trading activity in the local equity market.

The current SBL system only allows retail equity investors to be the borrowers of securities from the Taiwan Stock Exchange, securities companies or other financial firms for a wide range of purposes, such as short sales and then need to return securities to lenders, the FSC said. After the relaxation, retail investors will also be eligible to lend securities to brokerages or other financial firms so the TWSE will not serve as the only securities lending source to brokerages and financial firms, the FSC said. Since the SBL mechanism will allow lending in both directions, securities supplies are expected to be raised at a time when the FSC has relaxed the rules on day trading in which investors of a given stock are allowed to buy first and sell later or sell first and buy later in a single session.     [FULL  STORY]

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