Equities

SBL Regular and Front-End

Guaranteed SBL services provide facilities to the parties to the transaction in the form of open term, where the return can be made before maturity and the stock loan can be automatically extended, and fixed term, where the loan return can only be made at maturity and the loan period cannot be extended. Guaranteed SBL consists of Regular and Front-End SBL, which differ in fee calculation.

Regular SBL
Regular SBL has a fixed amount of fee, which is a maximum of 13% p.a to the loan recipient and a maximum of 12% p.a to the lender.

Front-End SBL
Front End SBL Implements a fee calculation through a bargaining process, with a maximum income for lenders of 17% p.a.

Besides fees, the difference between these types of SBL lies in the method of borrowing. For the regular SBL mechanism, by contacting IDClear manually to borrow securities, if a counterparty is already available i.e. the lender, then the borrower and the lender will make a SBL order in the e-CLEARS system. On the other hand, the SBL front end mechanism is done through front end application in borrowing, where there is a bargaining process for the fee amount between borrowers and lenders. If the fee bargaining process is finalized (matched), the borrowing order will be forwarded to the e-CLEARS system.

  • Parties that Become Participants angle-down

    Referring to IDClear Rule Number II-10 regarding Scripless Securities Borrowing-Lending Services, Securities Borrowing and Lending (SBL) is the borrowing and lending activity of securities between the securities owner as Lender to IDClear as the borrower or between IDClear as the lender with parties which require securities as the Borrower by submitting collateral as guarantee, in order to support the exchange transaction settlement activity. SBL transaction is temporary, which means that lenders transfers or lends his rights to use the securities to the borrower in a given period. The lender or the borrower can withdraw or reimburse these securities at any time.

    In the SBL transaction, the borrower must provide collateral and is obligated to pay the loan fee and transfer all the rights for the securities lent as the lender. Some of these rights are manufactured dividens, bonus shares, and any other corporate actions.

    Some of the benefits obtained by the lender and borrower of SBL transactions, among others:

    Parties Benefit
    Lender Additional income gained as Lender
    Borrower

    1. Avoid the default risk in delivering stocks for exchange transaction settlement

    2. Support short selling transaction strategy, margin trading performed by Clearing Member or its clients

    Parties that can participate in SBL transactions, in particular lenders are Clearing Members or Custodian Banks that have signed an agreement with IDClear. For Clearing Member clients or Custodian Banks may regularly lend its securities for SBL transaction purposes through its Clearing Member or Custodian Bank. Meanwhile the parties that may become borrowers are Clearing Members that have signed an SBL agreement with IDClear.

    The provisions to become SBL members can be seen in KPEI Regulation No II-10 and the registration procedures through membership menu here.

  • Transaction Flow and Settlement angle-down

      

List of Lendable Pool Shares angle-down