Securities Finance December, Q4, H2 and Full Year Snapshot 2025

In December, the securities lending markets generated monthly revenues of $1.2B, reflecting a 24% year-over-year increase and closing out the tenth consecutive month of revenues surpassing the $1B mark.  Revenues continued to be pushed higher thanks to further sustained demand for Asian equities.  December revenues for the asset class increased by 57% year-on-year as Hong Kong, South Korean, Taiwanese, Japanese and Malaysian equities continued to post substantial year-on-year improvements in returns.  Across EMEA equities, revenues also demonstrated strong year-on-year growth as UK, French, Swedish and German equities all experienced an increase in demand. UK equities were one of the standout performers during the month as average fees increased by 56% year-on-year to 0.43% and revenues grew by 127%.  In the Americas US equity revenues dipped both year-on-year and month-on-month after falling to their lowest monthly total since May.  US equities had a phenomenal 2025 however as annual revenues grew by 24% year-on-year to $4.8B.  ADRs were one of the standout performers in the region as investors looked for alternative routes to short foreign equities.  ADR revenues increased by 101% year-on-year during the month, generating their second highest monthly revenues of 2025.  Average fees also hit their second highest level of the year as well after reaching an average of 138bps.  Brazilian and Mexican equities also performed well during the month with strong growth in year-on-year revenues as average fees across Brazil once again climbed close to the 2% mark and after Mexican average fees hit a 2025 high of 71bps.

Exchange traded products continued to cement their place as a solid source of revenue of lenders during the month as assets under management across the industry edged ever closer to the magic $20trillion mark.  After an incredibly strong year for the asset class, December revenues did not disappoint.  Revenues increased by 52% year-on-year across the asset class as average lendable continued to grow.  Americas and EMEA ETPs led the charge from a revenue perspective but Asian ETPs closed an incredible year of growth (annual revenues +92% YoY) with increases seen in both average fees and revenues when compared on a year-on-year basis.

Fixed income assets also closed out a strong month, Q4, H2 and 2025 with government bonds posting their strongest monthly revenues of the year so far.  Changes in interest rates and ongoing fiscal and monetary policy uncertainty has created the perfect conditions for government bond lending during 2025.  Sustained and strong monthly revenues seen across corporate bonds is expected to carry through into 2026 as issuance remains high, capital expenditure on AI continues to generate volatility in the markets and spreads remain very tight.

In the securities lending markets during Q4, revenues exhibited strong year-over-year performance, with all asset classes showing positive year-on-year growth apart from corporate bonds.  The fourth quarter closed out a very strong year for the securities lending industry as revenues generated were some of the highest on record.  Not surprisingly many of the trends that followed throughout 2025 were still present during Q4.  Equities in both the US and Asia continued to thrive as did ADRs and Exchange Traded Products.  Asian equities finished the quarter 71% higher year-on-year as growth was seen across most countries.  Government bond markets experienced continued volatility with falling interest rate moves seen across all regions.  Despite falling interest rates in the US, EMEA and the UK, bond yields climbed as fiscal uncertainty remained front and center.  Corporate bonds was the only asset class to suffer a decline in revenues when compared year-on-year.  The decline was negligible however after falling by only 1%.

SAVE THE DATE

Q4 & 2025 Securities Finance Market Review

Our regular Q4 Webinar will be taking place on January 22nd 3PM UK / 10AM EST.  During the webinar we will be sharing the most recent Q4 data, and Robert Zekraus from GLMX will be discussing what 2026 may hold for market participants. 

To register for the webinar, please click HERE.