From December brokers, superannuation firms and hedge funds will be required to report when they are borrowing stock, the RBA revealed yesterday.
Under the new disclosure rules brokers are required to report to the ASX when they are using stock borrowed under security lending agreements in trades. The quantities of stock borrowed daily will be published by the ASX. Investors who frequently lend stock will also be obliged to disclose their lending activities.
These rules were developed after an RBA-led investigation into the delayed settlement of trades across the market last January indicated stock lending was to blame. Along with the new short selling reporting rules revealed last year, the RBA is hoping these new regulations will increase transparency, thereby increasing confidence in the markets in volatile times.
