Analyzing the Impact of the 2023 Banking Crisis on Securities Lending
Product Specialist, Data & Analytics Solutions
April 20, 2023
The collapse of Silicon Valley Bank sent shockwaves throughout both the U.S. and global financial sector. While the 2023 banking crisis will likely not be a watershed of the same magnitude as the collapses of 2008, it was a true test of the system and unsurprisingly had a significant impact on the securities lending market.
A Sudden Decline
In the aftermath of Silicon Valley Bank’s failure, a swathe of U.S. based regional banks as well as several large international banks became the focus of investor concern. Several of these institutions had recently faced capital challenges dealing with macroeconomic headwinds and were poised to bear the brunt of additional bank runs or systemic failures. The following chart compares average utilization and fee change for ten of the most impacted banking securities. It highlights the stark increase in loan activity since the failure of SVB compared to the rest of 2023.
DataLend, the market data service within EquiLend’s Data & Analytics Solutions group, tracks daily market movements across more than 62,000 unique securities in the $2.5 trillion securities finance market. www.datalend.com
EquiLend is a global financial technology firm offering Trading, Post-Trade, Data & Analytics, RegTech and Platform Solutions for the securities finance industry. EquiLend has offices in North America, EMEA and Asia-Pacific and is regulated in jurisdictions around the globe. www.equilend.com