The Taiwan Monthly

Nov. 2017

Trading Policies

TWSE relaxed the qualification for participating in the securities lending system

Aiming to increase the liquidity in securities market, the Taiwan Stock Exchange (TWSE) relaxed the limit on the qualification for participating in the securities lending system, which allows domestic corporations, funds, and offshore foreign institutional investors to be securities borrowers or lenders (“SBL participants”) without being limited to the identity of specific corporate institution. This relaxation has entered into force since July 31, 2017.

The TWSE securities lending system and the securities lending business conducted by securities firms are the two most critical securities lending channels in Taiwan. TWSE indicates that the relaxation on the qualification for participation will increase the consistency of the two securities lending channels and allow the securities lending market in Taiwan to be in line with the world, which will be beneficial to the circulation of securities. Meanwhile, TWSE also strengthens the control providing that insiders of a public company are forbidden to participate in the securities lending, and it also relaxes the number of extensions for the securities lending period to two times in order to provide a better securities lending environment.