Starting on June 2nd 2008 , the Securities Lending Program (BTC) offered by CBLC will include the Fixed Income securities traded at BOVESPA. CBLC will act as central counterparty in the process and will be responsible for all risk management procedures, such as calculating operational trading limits and maintaining stand-by credit lines.
For now, only the following corporate bonds will be allowed to trade: ABNOTE, BNDESPar, Petrobras, Suzano Papel e Celulose and Usiminas.
Borrowers are subjected to the following costs:
- lending fee charged by the lender (freely negotiable between lender and borrower).
- registration fee charged by CBLC (0.025% per year).
- broker's commission.
Lenders are not subjected to any transaction costs.
Investors shall contact the CBLC's Risk Management department to register securities and trades.
About BTC
The Securities Lending Program (BTC) is a service provided by CBLC – The Brazilian Clearing and Depository Corporation, through which investors may make securities available for lending, while interested parties may borrow them based on the presentation of collaterals. The CBLC acts as central counterparty in the process and guarantees the operations.
The service is accessed by investors through an electronic system. The borrower pays a fee to the lender, along with fees paid to CBLC. Dividends declared by the share issuer belong to the original owner of the security.
Most recent figures of BTC, based on April 2008 activity:
- Monthly Trading Value: BRL 28 billion
- Monthly Number of Transactions: 49,742
- Number of brokers offering the service: 84
- Number of underlying assets: 253
- Most active lenders: International investors
- Most active borrowers: Mutual funds
