Citibank's custody operation has been awarded a securities borrowing and lending agency license from the Thailand Ministry of Finance that allows the bank to lend to broker/dealers trading on the Thai stock exchange.
The license falls under a mandatory stock borrowing and lending program operated by the Thailand Securities Depository company that provides a channel for local brokers and sub-brokers to fulfill their settlement obligations to the stock exchange.
Using the license, Citibank will act as a securities lending agent facilitating loans between institutions holding Thai securities and the broker community, says Paul O'Brien, head of securities lending for the bank in Asia. "The issuance of a license to other qualified intermediaries is a positive step towards the continued development of securities lending activity in Thailand," he says.
Citibank will source the stock through its custodian network which includes the safe keeping of assets held by domestic Thai mutual funds, private funds and provident funds. Citibank claims to have the widest access to local shars amongst the foreign custodial banks operating in the country.
O'Brien says the move puts the bank in a good position to market securities lending services in the future as the Thai market continues to develop.