Swissquote taps Sharegain to offer securities lending to private clients
Swissquote Group, Switzerland’s provider of online trading services, has teamed up with Sharegain to launch a securities lending program for its private clients.
This new service allows users to lend their investment assets, like stocks and certain ETFs, to well-known financial institutions. In return, they get a monthly income directly through their bank account or app. Swissquote said that joining this program involves a clear registration process and accepting a contract that explains all the risks involved.
Clients have the flexibility to lend their entire portfolio or exclude specific securities from lending. They will keep getting dividends and can sell their securities anytime they want. However, during the loan period, they won’t be able to vote in shareholder meetings and might get cash payments instead of regular dividends.
One key feature of this program is the safety net provided by Swissquote. The bank holds collateral worth 105% of the value of the loaned assets, offering a layer of security for the clients.
Initially, Swissquote is limiting this service to stocks and ETFs, but it plans to include more types of assets later on. The return a client might earn varies, potentially ranging from 1% to over 5% per year, with monthly payments, but the actual rate depends on market demand.
Jan De Schepper, chief sales and marketing officer at Swissquote commented: “Following a successful launch in Luxembourg, Swissquote is now opening this opportunity for all its clients, excluding those in the US, regardless of portfolio size. They profit from convenient extra passive income from the securities they already own.”
Boaz Yaari, founder and CEO of Sharegain added: “We are delighted to partner with the fantastic team at Swissquote and deliver greater value to them and their clients. For too long, securities lending has benefited only the largest financial institutions.”
Sharegain, a B2B securities lending fintech company, also partnered with J.P. Morgan’s securities services division. This collaboration allows J.P. Morgan to improve its securities agency loan product by using Sharegain’s SLTech solution, making it available to more wealth managers and online brokers.