Bank of England Securities Lending Committee notes sharp rise in corporate bonds as collateral, efforts on diversity and inclusion

Bank of England
Minutes of the Securities Lending Committee
12 November 2020

An update was given on the size and composition of the securities lending market based on September 2020 data. The value of all securities made available globally by institutional investors was €22 trillion, a figure that had not changed significantly throughout the year. €2.3trillion of securities were out on- loan as at the reporting date, and of these, €1.2 trillion were government bonds.

In June 2020, the portion of corporate bonds posted as collateral increased sharply, constituting 25- 30% of all collateral posted – a significant shift away from equities. By September 2020, the composition of collateral had ‘normalised’ with equities comprising 52%, government bonds 43% and corporate bonds 3-5% of all non-cash collateral posted.
Results from a recently published repo survey in June 2020 were shared. Sterling-based collateral had increased in share to 58% of which 90% were government bonds and 10% corporate bonds.

One member cautioned that the shift in working patterns could cause disparity between genders. Citing a report from McKinsey, the message was that if gender diversity improvements are to be sustained then firms and leaders need to be aware of the disruptors that are impacting working women and people from different ethnic origins. The member cited a statistic from the report that more than 1 in 4 women are looking downshift or leave the workforce. Some women were being hit hard by the double shift syndrome – reduced support for childcare, and school closures (both of which disproportionately impact women) – leading to concerns about their work performance being judged negatively. The member also shared another statistic that senior women are one and half times more likely than men to downshift or leave because of burnout. The message was that day-to-day practical solutions can be taken to help address some of these issues.

Members agreed that more effort needed to be made to ensure that on-boarding new recruits was smoother and more structured. This involves ensuring that new recruits are supported in getting up to speed with their day-to-day tasks and the culture of their organisations. Members agreed that managers and peers need to be more involved on a day-to-day basis to on check-in with new recruits.

The full minutes are available at

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