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Nordic lending roundtable

25 November 2013

Industry leaders discussed proposed securities lending regulation in Norway, hedge fund activity, collateral transformation transactions and trade repositories

Read more: collateral securities lending hedge fund repository

Chair: What moves are authorities making to open up lending in Norway? Svante Sundholm: Under current Norwegian legislation, funds can only lend 10% of their assets to one single counterpart and funds are also prohibited from lending to counterparts that also use the loans themselves. Since the principal programmes run by the Nordic banks are run out of the entities that undertake market-making activities, many funds are unable to lend directly to these banks. Thus, only agency lending programmes have been possible. Finanstilsynet, the Financial Supervisory Authority of Norway, is looking to relax these rules and raise the 10% threshold and to take away requirements to not lend to counterparts that also use the loans themselves. Our counterparties believe this potential change of legislation to be of great importance and are looking over their internal rules to see if fund mandates can be rewritten so they can lend. However, there...