UK - The £9bn Strathclyde pension fund, one of the largest local authority pension funds, and the £5bn E.On scheme have suspended stock lending on all shares.

Strathclyde, run by Glasgow City Council, said in a statement it has temporarily suspended its securities lending programme "in light of recent actions by regulators to curb short selling in the markets."

A spokesman for the UK corporate pension fund of German energy major E.On told IPE the fund had also stopped all stock lending, though added it was a "very small part" of the pension fund's activities.

The funds follow in the footsteps of PGGM, which revealed last week it had stopped stock lending on all foreign financials shares. (See earlier IPE story: ‘PGGM ceases stock lending of foreign financials')

In a notice on its website, the Strathclyde admitted it had been hit hard by recent developments which saw massive financial institutions on both sides of the Atlantic being bailed out or bought out or, in the case of Lehman Brothers, collapsed.

"The current value of the fund will have fallen quite quickly. Clearly, with our global investment policy, the fund is affected by these events. We have been watching developments very closely and getting regular updates from our investment managers," read the update.

"We own shares in most big companies around the world, and that includes Lehman, HBOS, Freddie Mac, Fannie Mae, AIG and the other names which have been in the news,"

The fund stressed, however, it has around 3,000 different investments in total, so its investment risk is spread very widely, adding as a pension scheme it should not be unduly concerned at current values.

Strathclyde also confirmed it is now closing some positions where Lehman was a counterparty.

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