Exclusive securities lending agreement: Difference between revisions
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{{fwmd|ESLA}}An [[exclusive securities lending agreement]] (“[[ESLA]]”) is an arrangement where a {{gmslaprov|Lender}} grants a {{gmslaprov|Borrower}} the exclusive right to borrow from a portfolio of [[securities]]. It is documented under a separate [[ESLA]], an additional legal agreement governing the terms of the exclusivity. | |||
{{fwmd|ESLA}} | |||
An [[exclusive securities lending agreement]] (“[[ESLA]]”) is an arrangement where a {{gmslaprov|Lender}} grants a {{gmslaprov|Borrower}} the exclusive right to borrow from a portfolio of [[securities]]. It is documented under a separate [[ESLA]], an additional legal agreement governing the terms of the exclusivity. | |||
It covers a pre-agreed period and may include specific programme parameters and eligibility criteria. | It covers a pre-agreed period and may include specific programme parameters and eligibility criteria. | ||
Conceptual question: is an ESLA a form of [[equity option]]? Should you figure it into your shareholding disclosure programme? Is it subject to | Conceptual question: is an ESLA a form of [[equity option]]? Should you figure it into your shareholding disclosure programme? Is it subject to [[EMIR]] collateralisation and all that guff? | ||
{{sa}} | |||
*[[GMSLA Anatomy]] | |||
Latest revision as of 13:30, 14 August 2024
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| Docs | Appendage to a stock lending agreement. Extra mark for needless verbosity. | 3 |
| Amendability | Bilateral. Easyt peasy. | 0 |
| Collateral | Yes, per stock lending agreement. Liquid, daily, but may be crappy assets. | 3 |
| Transferability | Not without novation. But why would you? | 0 |
| Leverage | Nope | 0 |
| Fright-o-meter | Well, it’s used in connection with short selling but really, snoresville. | 1 |
An exclusive securities lending agreement (“ESLA”) is an arrangement where a Lender grants a Borrower the exclusive right to borrow from a portfolio of securities. It is documented under a separate ESLA, an additional legal agreement governing the terms of the exclusivity. It covers a pre-agreed period and may include specific programme parameters and eligibility criteria.
Conceptual question: is an ESLA a form of equity option? Should you figure it into your shareholding disclosure programme? Is it subject to EMIR collateralisation and all that guff?