A securities firm may lend only the following securities in conducting securities borrowing and lending business:
If a securities firm is short of subject securities to meet its obligations to redeliver securities, it may seek refinancing from a securities finance enterprise.
- Securities held for its own account.
- Securities borrowed through the securities lending system of a securities exchange.
- Collateral securities obtained in connection with customer margin purchases when conducting securities trading margin purchase and short sale business.
- Securities borrowed from a customer.
- Securities borrowed from another securities firm or securities finance enterprise conducting securities borrowing and lending business or securities margin purchase and short sale business.