Secs lending 'oils the machine' – Kas Bank
NETHERLANDS - Albert Röell, chairman of Dutch securities bank Kas Bank' managing board, has warned securities lending is "the oil for the financial machine".
Röell told IPE during Kas Bank's annual New Year's reception in London he regretted the stance of many pension funds who have decided to stop their securities lending practices.
He made his comments as the £39.7bn (€44bn) BT Pension Scheme said it plans to keep in place a ban on stock lending despite the lifting of an official ban on the practice, according to reports. (See earlier IPE story: BT fund 'retains stock lending ban')
Röell claimed securities lending is misunderstood by many pension funds, and argued they have overreacted by banning the stock lending.
The practice has been much criticised in recent months, as opponents claimed stock lending is not prudent in the current market place.
Kas Bank also revealed it plans become the first custodian to sign the United Nation's Principles of Responsible Investing (PRI) later on this quarter.
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