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Securities Lending

  • There was also some discussion of the lack of liquidity associated with this program and it was felt that that is certainly consideration which must be taken into effect by companies contemplating such transactions.


  • 1982 - SOA - Investment Vehicles to Cope with Inflation, Society of Actuaries - 24p
  • 2015 - OFR - Reference Guide to U.S. Repo Securities and Securities Lending Markets- 70p

Hester Peirce

  • 2014 YEAR? - AIG: The Missing Piece of Its Failure Narrative & Why It Matters, Hester Peirce, Senior Research Fellow - 70p
  • 2014 05 - Securities Lending and the Untold Story in the Collapse of AIG, Hester Peirce - No. 14-12 - 82p
  • The Real Story of AIG's Failure and Why Dodd-Frank Didn't Fix It - Hester Peirce - YouTube
    • Securities Lending, Ponzi Scheme, Paul Tucker
  • Prudential indicated that it has not had losses since it got into the securities lending business in the 1980s and it is viewed today as essentially a risk-free transaction. (p23)

2007 - SOA - SmallTalk, Society of Actuaries - 28p

  • 2011 0316 - GOV (Senate) - Securities Lending in Retirement Plans: Why The Banks Win, Even When You Lose [page-link] [PDF-191]

  • 2012 0427 - FSB - Securities Lending and Repos: Market Overview and Financial Stability Issues - 45p
  • 2013 0827- FSB - Peer Review of the United States - 65p
    • Life insurers that engaged in securities lending business were negatively affected by illiquid markets during the financial crisis as a result of reinvesting cash collateral in illiquid instruments.  (p34)
  • Figure 7 illustrates our identification strategy by focusing on the differences in lending behavior between MetLife and AIG.

2019 - FRB - Over-the-Counter Market Liquidity and Securities Lending - 61p

  • 2013 - FRB - Repo and Securities Lending - 21p
  • 2012 0313 - FT (Financial Times) - Insurers warned over ‘shadow banking’ risk, Brooke Masters in London 
  • 2018 0307 - GOV (House) - Legislative Review of H.R. 5059: The State Insurance Regulation Preservation Act - 1:48:00 - [PDF-86pVIDEO-youtube

    • 1:34 - Schwarcz: Securities Lending, AIG Life Insurance


  • Bean
  • Skinner - UK
  • Securities lending has been in existence for many years but was not availableto private pension funds until January 1, 1981 when the Department of Labor issued an exemption for all private pension funds. It is a means ofgenerating income to a pension fund with minimal risk.

1982 - SOA - Investment Vehicles to Cope with Inflation, Society of Actuaries - 24p

The exposure draft was to have been ready for this meeting... 

  • ....but the group is doing further study of securities lending transactions, which have several similar attributes with asset transfers with "puts"; thus, any exposure draft at this time might be premature.

1985-2, NAIC Proceedings - Study Group on Reporting for New Investment Vehicles - Securities Lending

  • Insurance companies must also follow the appropriate statutory accounting rules related to securities lending transactions, which are included in the NAIC Accounting Practices and Procedures Manual.