Securities lending: A record H1 built on broad demand
04 August 2026
Matt Chessum, executive director, equity and analytic products at S&P Global Market Intelligence, reviews the record-setting first half of the financial year and the drivers behind it
Image: Shutterstock
The story of the first half of 2026 is, above all, a story of records. Securities lending revenues reached US$8.8 billion, up 33 per cent year-on-year (YoY), the strongest first half on record and comfortably clear of the previous 2023 peak of US$7 billion.
The second quarter set the pace with a record US$5 billion, up 34 per cent, as average balances climbed 31 per cent to roughly US$3.9 trillion and fees held steady near 0.45 per cent. What makes the half stand out is not one outsized position but the breadth of it: records fell across region after region and asset class after asset class.
H1 2026 Securities Lending Revenues
The forces behind the numbers
The economic backdrop did much of the work. Sustained investment in artificial intelligence, data centres, semiconductors, and the power to run them, kept technology names in focus and pushed equity indices higher. Geopolitical tension, energy prices, and inflation concerns kept volatility elevated, while shifting expectations for central bank policy had investors repricing rates at every turn. Running through all of it was a clear rotation towards Asia, which drew rising investor attention and capital flows. Each of these threads fed the same outcome: more demand to borrow, and higher lending revenues to match.
Asia leads the record run
Nowhere was that clearer than in Asian equities, the defining growth story of the first six months of the year. H1 revenues rose 80 per cent across this asset class, to around US$2.4 billion, with balances up more than half and fees firmer by 16 per cent.
Revenues generated in the second quarter alone nearly doubled YoY to US$1.45 billion — enough to make Asian equities the single largest revenue contributor and, for the first time on record, to push it ahead of Americas equities. Hong Kong (US$429 million), Taiwan (US$424 million), and South Korea (US$288 million) led the way, carried by demand for semiconductor and technology names; four of the region’s top five borrowed stocks in H1 came from the technology sector, the exception being consumer discretionary name Pop Mart International. The same momentum showed up in specials, loans priced at 500 basis points or more, where Asian equities generated US$855 million in Q2, 54 per cent of the global total and, again, ahead of Americas equities for the first time in history.
Records across the board
The record theme repeated well beyond Asia. Exchange traded products (ETPs) rose 65 per cent in H1 to just under US$900 million, with Q2 revenues up 83 per cent on a 29 per cent rise in balances and a 41 per cent lift in fees; corporate bond trackers such as LQD and HYG led fixed income demand, while technology, leveraged crypto, and oil funds featured among the top equity exchange traded fund (ETF) borrows. EMEA equities climbed 59 per cent to around US$960 million, with Germany the standout market ahead of Sweden and France.
Fixed income assets also joined in. Government bond revenues rose 33 per cent over the first six months generating US$1.4 billion, and the Q2 total of US$747 million was the highest seen for many years, supported by a 31 per cent rise in balances and steady demand for high-quality collateral.
Borrowing was concentrated in US Treasuries, particularly sub-10-year issues, but the single highest quarterly generator was a non-US bond — the French Treasury 5.5% 25/04/29 — which contributed US$5.1 million in revenues alone. Corporate bond revenues grew 13 per cent YoY to just over US$560 million, the top 10 borrows, mostly private placements, produced US$18.3 million in Q2. American Depositary Receipts (ADRs) added 28 per cent when compared to Q2 2025 to reach US$290 million in revenues, with Infosys and Wipro alone accounting for 58 per cent of the asset class’s quarterly revenue.
The one exception to the upward run was Americas equities, where revenues eased 6 per cent YoY to US$2.1 billion even as balances rose more than a third, as average fees compressed by roughly 30 per cent. Much of that difference, however, reflects the difference made by Coreweave revenues, having driven an unusually strong Q2 2025, after producing US$310 million in returns alone.
A supportive rate backdrop for cash reinvestment
Higher-for-longer rates reinforced the picture. Cash reinvestment returns totalled around US$1.44 billion in H1, up from roughly US$998 million a year earlier, as the US Federal Reserve held its target range at 3.50–3.75 per cent at both the April and June meetings.
At the June meeting, the first under Chair Kevin Warsh, the Committee held unanimously, dropped its easing bias and raised year-end projections to 3.6–4.1 per cent, prompting markets to price in roughly a 70 per cent chance of a September rate rise.
Momentum into the second half
The conditions that produced these records, elevated valuations, ongoing volatility, steady AI-related demand, and strong flows into Asia, were still firmly in place as the second half of the year began. Summer volumes may thin and further volatility is possible, but the core drivers that have been responsible for producing these returns show little sign of fading. Asian equities look set to remain a leading contributor, ETF demand is expected to keep building, and reinvestment income is expected to stay supported while the Fed’s next move looks more likely to be a hike than a cut.
There is fresh ground to watch, too. Smaller, more peripheral EMEA markets delivered some of the strongest growth of the half: Greek equity revenues rose 975 per cent YoY in Q2 to around US$10 million as balances more than tripled, Turkish revenues climbed 194 per cent to about US$20 million despite ongoing uncertainty over short sale rules, and Portugal added 122 per cent to reach around US$7 million on sharply firmer fees. Latin America was a further bright spot, generating close to US$70 million in H1, roughly double the prior year, with balances up around 47 per cent, Brazil contributing about US$64 million and Mexico around US$6 million, as efforts to open and standardise these markets continued.
With records already set across Asian equities, ETFs, specials, and government bonds, the first half has given the industry a strong platform to continue into H2. The question for the months ahead is not whether demand exists, but how much further this run can go.
The second quarter set the pace with a record US$5 billion, up 34 per cent, as average balances climbed 31 per cent to roughly US$3.9 trillion and fees held steady near 0.45 per cent. What makes the half stand out is not one outsized position but the breadth of it: records fell across region after region and asset class after asset class.
H1 2026 Securities Lending Revenues
The forces behind the numbers
The economic backdrop did much of the work. Sustained investment in artificial intelligence, data centres, semiconductors, and the power to run them, kept technology names in focus and pushed equity indices higher. Geopolitical tension, energy prices, and inflation concerns kept volatility elevated, while shifting expectations for central bank policy had investors repricing rates at every turn. Running through all of it was a clear rotation towards Asia, which drew rising investor attention and capital flows. Each of these threads fed the same outcome: more demand to borrow, and higher lending revenues to match.
Asia leads the record run
Nowhere was that clearer than in Asian equities, the defining growth story of the first six months of the year. H1 revenues rose 80 per cent across this asset class, to around US$2.4 billion, with balances up more than half and fees firmer by 16 per cent.
Revenues generated in the second quarter alone nearly doubled YoY to US$1.45 billion — enough to make Asian equities the single largest revenue contributor and, for the first time on record, to push it ahead of Americas equities. Hong Kong (US$429 million), Taiwan (US$424 million), and South Korea (US$288 million) led the way, carried by demand for semiconductor and technology names; four of the region’s top five borrowed stocks in H1 came from the technology sector, the exception being consumer discretionary name Pop Mart International. The same momentum showed up in specials, loans priced at 500 basis points or more, where Asian equities generated US$855 million in Q2, 54 per cent of the global total and, again, ahead of Americas equities for the first time in history.
Records across the board
The record theme repeated well beyond Asia. Exchange traded products (ETPs) rose 65 per cent in H1 to just under US$900 million, with Q2 revenues up 83 per cent on a 29 per cent rise in balances and a 41 per cent lift in fees; corporate bond trackers such as LQD and HYG led fixed income demand, while technology, leveraged crypto, and oil funds featured among the top equity exchange traded fund (ETF) borrows. EMEA equities climbed 59 per cent to around US$960 million, with Germany the standout market ahead of Sweden and France.
Fixed income assets also joined in. Government bond revenues rose 33 per cent over the first six months generating US$1.4 billion, and the Q2 total of US$747 million was the highest seen for many years, supported by a 31 per cent rise in balances and steady demand for high-quality collateral.
Borrowing was concentrated in US Treasuries, particularly sub-10-year issues, but the single highest quarterly generator was a non-US bond — the French Treasury 5.5% 25/04/29 — which contributed US$5.1 million in revenues alone. Corporate bond revenues grew 13 per cent YoY to just over US$560 million, the top 10 borrows, mostly private placements, produced US$18.3 million in Q2. American Depositary Receipts (ADRs) added 28 per cent when compared to Q2 2025 to reach US$290 million in revenues, with Infosys and Wipro alone accounting for 58 per cent of the asset class’s quarterly revenue.
The one exception to the upward run was Americas equities, where revenues eased 6 per cent YoY to US$2.1 billion even as balances rose more than a third, as average fees compressed by roughly 30 per cent. Much of that difference, however, reflects the difference made by Coreweave revenues, having driven an unusually strong Q2 2025, after producing US$310 million in returns alone.
A supportive rate backdrop for cash reinvestment
Higher-for-longer rates reinforced the picture. Cash reinvestment returns totalled around US$1.44 billion in H1, up from roughly US$998 million a year earlier, as the US Federal Reserve held its target range at 3.50–3.75 per cent at both the April and June meetings.
At the June meeting, the first under Chair Kevin Warsh, the Committee held unanimously, dropped its easing bias and raised year-end projections to 3.6–4.1 per cent, prompting markets to price in roughly a 70 per cent chance of a September rate rise.
Momentum into the second half
The conditions that produced these records, elevated valuations, ongoing volatility, steady AI-related demand, and strong flows into Asia, were still firmly in place as the second half of the year began. Summer volumes may thin and further volatility is possible, but the core drivers that have been responsible for producing these returns show little sign of fading. Asian equities look set to remain a leading contributor, ETF demand is expected to keep building, and reinvestment income is expected to stay supported while the Fed’s next move looks more likely to be a hike than a cut.
There is fresh ground to watch, too. Smaller, more peripheral EMEA markets delivered some of the strongest growth of the half: Greek equity revenues rose 975 per cent YoY in Q2 to around US$10 million as balances more than tripled, Turkish revenues climbed 194 per cent to about US$20 million despite ongoing uncertainty over short sale rules, and Portugal added 122 per cent to reach around US$7 million on sharply firmer fees. Latin America was a further bright spot, generating close to US$70 million in H1, roughly double the prior year, with balances up around 47 per cent, Brazil contributing about US$64 million and Mexico around US$6 million, as efforts to open and standardise these markets continued.
With records already set across Asian equities, ETFs, specials, and government bonds, the first half has given the industry a strong platform to continue into H2. The question for the months ahead is not whether demand exists, but how much further this run can go.
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