Across multiple calculators and analyses, we find the same conclusion that banks and brokers should post margin for beneficial owners lending securities on the DTCC NSCC Securities Finance Transaction (SFT) central counterparty (CCP) through an agent lender. The math works across RWA, Leverage Ratio, operations and daily accrual accounting. While this may be an unpopular opinion and we’ve already heard doubts, we make the argument that for the benefit of the entire industry, borrowers posting margin should be standard practice.
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