The global securities finance industry generated $850 million in revenue for lenders in February 2023, according to DataLend, the market data service of fintech EquiLend. The figure represents a 34% increase from the $634 million generated in February 2022.
Global broker-to-broker activity, where broker-dealers lend and borrow securities from each other, totaled an additional $240 million in revenue in February, a 30% increase year-over-year.
Month-over-month, the $850 million in revenue generated for lenders in February represents a 4% decrease from the $890 million generated for lenders in January 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 40% year-over-year and 7% from January.
A strong market for prominent US equities helped increase revenue by 51% in North America, the bulk of the global year-over-year gain. North American securities trading “special,” where fees meet or exceed 500 basis points, generated an impressive $329 million, a 108% revenue increase over the same period last year.
The top five earners in February 2023—AMC Entertainment Holdings (AMC), Lucid Group (LCID), Beyond Meat Inc (BYND), MicroStrategy (MSTR) and GameStop Corporation (GME)—were the same five securities as in January. In total, the group generated $155 million in revenue in the month and $30 million more than they commanded in January.
Performance was also solid in EMEA and APAC across all asset classes with year-over-year (yoy) revenue improvements of 22% and 2% respectively. However, earnings in these territories did cool from the start of 2023 with a month-to-month dip of 18% in EMEA and a 10% decrease in APAC.