SLB – Securities Lending and Borrowing
Stock Lending and Borrowing (SLB) Mechanism is a platform wherein a person
can lend theor idle shares in their portfolio to a borrower to fulfill his settlement
obligation.
Stock Lending and Borrowing (SLB) transactions are executed through a fully automated
screen based trading platforms of stock exchanges which adopt the principle of an
order driven market and where lending and borrowing orders are executed on price
time priority, similar to the equity trading system. There is no counter party risk
to either Lender or Borrower since the Clearing Corporations of the Stock Exchanges,
as central counterparty, provide financial settlement guarantee for all SLB transactions.
As Lender, SLBM provides you an official low cost platform to earn risk-free
Incremental Income (Lending Fees) from your idle portfolio, while fully
protecting all your rights as owner, including all corporate benefits and actions
on your holding, without any Capital Gain Tax implication on your SLB transaction.
As borrower, SLBM provides you a platform to cover your unintended short
position created in the books and avoid settlement failure and auction or to support
a trading/hedging strategy.