By Mark McSherry
The global securities finance industry generated $1.05 billion in revenue for lenders in April 2023, according to DataLend, the market data service of fintech EquiLend.
The figure represents a 27% increase from the $828 million generated in April 2022.
Global broker-to-broker activity, where broker-dealers lend and borrow securities from each other, totaled an additional $279 million in revenue in April, a 22% increase year-over-year.
Month-over-month, the $1.05 billion in revenue generated for lenders in April represents a 3% increase from the $1.02 billion generated for lenders in March 2023.
According to DataLend, the improvement in lender-to-broker revenue over 2022 was largely due to a continued increase in fees.
Globally, across all asset classes, lending fees climbed 32% year-over-year and 9% from March.
A strong market for global equities helped increase revenue by 45% in North America, 16% in EMEA and 7% in APAC year-over-year.
DataLend said: “Securities trading ‘special,’ where fees meet or exceed 500 basis points (bps), generated a staggering $525 million, a 52% increase over the same period last year and up 10% from the month prior.
“The top five earners in April 2023 were AMC Entertainment Holdings (AMC), Upstart Holdings (UPST), Lucid Group (LCID), GameStop Corp (GME) and DNB Bank (DNB NO). In total, the group generated $151 million in revenue in the month – $48 million more than the top five returned in March.
“Performance was also strong for corporate and government debt, with year-over-year revenue improvements of 67% and 5%, respectively.
“However, revenue from lending government debt declined by 11% from the prior month.”