IMN: Do lenders struggle to keep up with their clients?
12 September 2018 London
Image: Shutterstock
鈥淒o securities lenders live by a vanilla-type business report?鈥�, questioned one panellist at this year鈥檚 annual European Securities 麻豆影视传媒 and Collateral Management Conference.
During a session concentrating on critical issues heading the agendas of beneficial owners, the panellist questioned whether lenders struggle to keep up with their clients.
The panellist challenged the lenders on the panel suggesting that 鈥渢he minute a client wants to step outside that norm, some of you struggle to keep up with that client鈥�.
In answer to this comment, one panellist said: 鈥淭here has been a legacy thought process in this business to standardise and push that standardisation through. There鈥檚 increasing agility in providers and across providers. We have the infrastructure, so we鈥檙e increasingly seeing clients coming to us around initial margin, where they need to generate cash on short notice.鈥�
Another panellist stated: 鈥淩esources are scarce in most organisations, that said, we鈥檝e got a pretty good record of being innovative. If you look at our business compared to some others, for example, when it comes to Securities Financing Transactions Regulation (SFTR), we are ahead of others and we鈥檙e quite good at doing that.鈥�
The panellist explained that one reason for this aforementioned struggle to 鈥渒eep up with the client鈥�, may be the increasing level of regulatory compliance, as well as the need to keep up with the speed of technological innovation.
They added: 鈥淭here鈥檚 so much going on with emerging technology now, we鈥檙e spending a huge amount of time around innovation. We鈥檙e looking at a lot of technology solutions for things like peer-to-peer lending.鈥�
One panellist compared the level of innovation available before the financial crisis to now, stating: 鈥淚n terms of innovation, [in the context of] the financial crisis 10 years ago, lending programmes, across the board, then and now, are hugely different.鈥�
They added: 鈥淭hat one size fits all concept has hugely disappeared. We have had to be very innovative and flexible to meet all those needs, provide those services, be flexible and keep the beneficial owner community happy.鈥�
Another said: 鈥淭imes have changed鈥搘e understand a borrower's perspective more now than perhaps we may have 20 to 30 years ago.鈥�
Panellists spoke of regulations that would ensure a financial crisis, such as the 2007-8 financial crisis, would not happen again.
One panellist said: 鈥淭he second Markets in Financial Instruments Directive has forced various execution policies and parameters鈥攚e try to be as transparent as possible and as an industry, we鈥檙e doing that all the more now.鈥�
However, one panellist stated: 鈥淓ven though we now have a very good framework for reporting, SFTR doesn鈥檛 necessarily cover everything our clients ask about鈥搒urprisingly.鈥�
During a session concentrating on critical issues heading the agendas of beneficial owners, the panellist questioned whether lenders struggle to keep up with their clients.
The panellist challenged the lenders on the panel suggesting that 鈥渢he minute a client wants to step outside that norm, some of you struggle to keep up with that client鈥�.
In answer to this comment, one panellist said: 鈥淭here has been a legacy thought process in this business to standardise and push that standardisation through. There鈥檚 increasing agility in providers and across providers. We have the infrastructure, so we鈥檙e increasingly seeing clients coming to us around initial margin, where they need to generate cash on short notice.鈥�
Another panellist stated: 鈥淩esources are scarce in most organisations, that said, we鈥檝e got a pretty good record of being innovative. If you look at our business compared to some others, for example, when it comes to Securities Financing Transactions Regulation (SFTR), we are ahead of others and we鈥檙e quite good at doing that.鈥�
The panellist explained that one reason for this aforementioned struggle to 鈥渒eep up with the client鈥�, may be the increasing level of regulatory compliance, as well as the need to keep up with the speed of technological innovation.
They added: 鈥淭here鈥檚 so much going on with emerging technology now, we鈥檙e spending a huge amount of time around innovation. We鈥檙e looking at a lot of technology solutions for things like peer-to-peer lending.鈥�
One panellist compared the level of innovation available before the financial crisis to now, stating: 鈥淚n terms of innovation, [in the context of] the financial crisis 10 years ago, lending programmes, across the board, then and now, are hugely different.鈥�
They added: 鈥淭hat one size fits all concept has hugely disappeared. We have had to be very innovative and flexible to meet all those needs, provide those services, be flexible and keep the beneficial owner community happy.鈥�
Another said: 鈥淭imes have changed鈥搘e understand a borrower's perspective more now than perhaps we may have 20 to 30 years ago.鈥�
Panellists spoke of regulations that would ensure a financial crisis, such as the 2007-8 financial crisis, would not happen again.
One panellist said: 鈥淭he second Markets in Financial Instruments Directive has forced various execution policies and parameters鈥攚e try to be as transparent as possible and as an industry, we鈥檙e doing that all the more now.鈥�
However, one panellist stated: 鈥淓ven though we now have a very good framework for reporting, SFTR doesn鈥檛 necessarily cover everything our clients ask about鈥搒urprisingly.鈥�
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