Lenders are generally UK or overseas institutions such as banks,
insurance companies, other financial concerns, pension funds and
charities, which hold large portfolios of securities. However,
there is nothing to prevent other persons holding securities from
entering into stock lending transactions.
Stock lending is an important mechanism in the efficient
operation of the financial markets and mostly takes place under a
standard form of contract (
CFM17165). This sets out the normal
terms for collateral, margin and manufactured payments, though the
parties will normally adapt these for particular transactions.
