We'd like to remind Forumites to please avoid political debate on the Forum... Read More »
Shares/Securities Lending

bbxsa
Posts: 42 Forumite
Do brokers in the UK engage in the lending of shares/securities in a customer's account (i.e. to short sellers)? Does this apply to all account types or only margin accounts? Are shares in an ISA lent out? Is there a way to prevent your broker from lending out your shares?
Please post links/references to replies.
Thanks.
Please post links/references to replies.
Thanks.
0
Comments
-
In response to another thread on a different topic, I was directed to:
http://www.hmrc.gov.uk/isa/isa-guidance-notes-2008.pdf
where it reads:Stock lending
10.56 Stock lending is a transaction where somebody “borrows” securities from another person by taking a transfer of the securities from that person in order to enable him or her to fulfil a contract to sell securities of that kind to a third person. In return he or she promises to transfer securities of the same kind to the person from whom he or she has “borrowed” the securities that have gone to the third person and to compensate the “lender” for any dividends which would have been received during the loan period when he or she does so.
10.57 “Lending” of this sort by a manager is not compatible with his or her duties as an ISA manager. The title to investments must be vested in the ISA manager or his or her nominee, or jointly in one of them and the investor, the share certificate must be held by the manager or as he or she may direct and, above all, the investments must be in the beneficial ownership of the investor. None of this is compatible with an arrangement under which the investments are sold to a third person and subsequently replaced by different investments of the same kind.0
This discussion has been closed.
Confirm your email address to Create Threads and Reply

Categories
- All Categories
- 350.1K Banking & Borrowing
- 252.8K Reduce Debt & Boost Income
- 453.1K Spending & Discounts
- 243.1K Work, Benefits & Business
- 597.4K Mortgages, Homes & Bills
- 176.5K Life & Family
- 256K Travel & Transport
- 1.5M Hobbies & Leisure
- 16.1K Discuss & Feedback
- 37.6K Read-Only Boards