IOCBC SHARE LENDING AND BORROWING ACCCOUNT

Extend your trading strategies with share lending and borrowing

Why you will love this

Earn potential fees income if your shares are borrowed.

Engage in trading strategies such as shorting and hedging

Ability to cover your position if you accidentally short-sell

Who can apply

Aged 21 years and above

Must also have a Basic Trading Account

Apply now
 

Earn up to 8% p.a. when you lend your sharesFind out more

For local application

Apply at a branch with these supporting documents 

  1. For Singaporeans and Permanent Residents:

    • NRIC/SAF/SPF ID and Passport

    For Malaysians:

    • IC and Singapore Residence Pass (e.g. Employment pass) if applicable

    For Foreigners:

    • Valid Passport and Singapore Residence Pass (e.g. Employment pass) if applicable

    Note: Bring the originals of these Identification Documents (ID)

  2. Provide us with the original or electronic copy of any of the following documents reflecting your name and address:

    • Bank statement from a Monetary Authority of Singapore (MAS) licensed bank
    • Latest CPF statement
    • Latest Notice of tax assessment from IRAS

    Note: Document(s) must be dated no older than 3 months from date of application. If your mailing address is different from your residential address, please provide one document for each address.
    If you are applying for a corporate account, please call us at 1800 338 8688

Locate a branch

For overseas application

Mail in the completed application forms with copies of:  

  1. Required for all:

    Optional Forms

  2. Provide a copy of your identification:

    For Singaporeans and Permanent Residents:

    • NRIC/SAF/SPF ID and Passport

    For Malaysians:

    • IC and Singapore Residence Pass (e.g. Employment pass) if applicable

    For Foreigners:

    • Valid Passport and Singapore Residence Pass (e.g. Employment pass) if applicable

    Bring your original ID, the photocopy and our account application form to any of the below authorised parties to witness your signature on the form and certify true copy of your ID:

    • Notary Public
    • Advocates & Solicitors
    • Singapore Embassy

    The witnessing officer should provide his/her name and contact details.

  3. Provide us with the original or electronic copy of any of the following documents reflecting your name and address:

    • Bank statement from a Monetary Authority of Singapore (MAS) licensed bank
    • Latest CPF statement
    • Latest Notice of tax assessment from IRAS

    Note: Document(s) must be dated no older than 3 months from date of application. If your mailing address is different from your residential address, please provide one document for each address.

  4. Mail it to us

    OCBC Securities Private Limited
    18 Church Street #01-00,
    OCBC Centre South,
    Singapore 049479

What is a Share Borrowing and Lending Account?

Share Borrowing and Lending Account allows you to lend your shares to other investors or borrow shares when you need them.

If your shares are borrowed, you can earn fees while still being entitled to the economic benefits of the shares.

If you borrow shares, you can use them for strategies like Short selling or Hedging. It’s a way you can make your investments more flexible and potentially more rewarding.

While this account offers flexibility, certain activities, such as borrowing shares for short selling, come with inherent risks and require careful consideration.

Benefits and fees

What is Share Lending?

Share lending is a programme that enables you to lend out your shares custodised in your Basic Cash Trading Account in exchange for a lending fee for the shares which are borrowed by OCBC Securities.

If your shares are borrowed, you will continue to be entitled to corporate actions such as dividends and bonus issues. This offers a way for you to potentially earn a recurring fee income from long-term holdings.

Benefits

Earn potential passive income

Get a fee for lending out your shares.

Get a fee for lending out your shares.

Entitlement to economic benefits

You are still entitled to corporate actions such as dividends, bonus and rights issues for shares you have lent out.

You are still entitled to corporate actions such as dividends, bonus and rights issues for shares you have lent out.

No lock-in period

Flexibility to sell your shares^

Flexibility to sell your shares^

^Please note that the returning of shares to the lender will be within one settlement cycle.

Lending Fee

If your shares are lent out, you will be entitled to receive a lending fee of up to 8% p.a.*, depending on market demand.

Here is how your lending fee is calculated:

Lending fee/day = (Market Value x FX x Lending Rate %) / 365 days
Where
Market Value = Closing Price x Quantity Loaned

*The lending of securities is not guaranteed, and the lending fee may vary depending on market conditions. OCBC Securities will only borrow your securities based on prevailing market demand, and there may be instances where some or all of your securities are not lent out.

How it works

Submit your consent

Log in to iOCBC online trading platform > More > Other Declarations > Sign the ‘SBL On-Lend Consent Form’. Alternatively, you may also reach out to your Trading Representative (TR) to provide you with the consent form.

Log in to iOCBC online trading platform > More > Other Declarations > Sign the ‘SBL On-Lend Consent Form’. Alternatively, you may also reach out to your Trading Representative (TR) to provide you with the consent form.

View your lent shares

Once your consent form has been processed, you will be able to see your lent counters under your portfolio on the iOCBC trading platform.

Once your consent form has been processed, you will be able to see your lent counters under your portfolio on the iOCBC trading platform.

Opt out anytime

To stop the lending facility, please reach out to your Trading Representative.

To find out who your Trading Representative (TR) is, follow these three simple steps:

  1. Log in to your trading account via iOCBC online trading platform
  2. Click on “More” on the top menu
  3. Select “Account Details” to view your TR’s contact details

To stop the lending facility, please reach out to your Trading Representative.

To find out who your Trading Representative (TR) is, follow these three simple steps:

  1. Log in to your trading account via iOCBC online trading platform
  2. Click on “More” on the top menu
  3. Select “Account Details” to view your TR’s contact details

What is Share Borrowing?

Share borrowing allows clients to borrow shares to sell in the ready market. Clients may use this strategy when they expect a stock's price to fall. If their prediction is correct and the target price is reached, clients may choose to buy back the shares and return them to the lender. The difference between the selling price and the lower buying price would be their profit.

Benefits

Capture potential opportunities in a bear market

When you hold a short-term bearish view on a certain share, having a Share Lending and Borrowing account allows you to borrow the shares and engage in a 'Sell First and Buy Back Later' strategy. This means you sell the borrowed shares at the current price and later buy them back at a lower price if the market moves as you expect.

Have a possible failcover if you accidentally short sell

Shorting is a planned strategy but sometimes traders may accidentally oversell their shares, ie. they sell a greater quantity of a stock than what is available in their portfolio and will be subjected to a buy-in by the exchange. Having a Share Borrowing account potentially helps you avoid buy-ins as you may simply borrow shares from us to cover your short position.

Trading strategies

Shorting

Engage in directional shorting if you hold a bearish view of a market or share.

Arbitrage

You can arbitrage if you see a mispricing between the underlying shares and its derivatives.

Hedging

Hedge if you wish to lock in safe price in anticipation of the securities you will receive due to bonus or rights issues.

Pairs trading

You can pair trade if you notice a divergence in two similar and correlated shares.

Borrowing Fee

The share borrowing fees are accrued (but not compounded) on a daily basis and collected from you monthly.

Here is how your borrowing fee is calculated:

Borrowing fee = Market Value X Borrow Rate
where
Market Value = Last Done Price X Quantity Borrowed

How much collateral do you need?
Example Borrow Limit 2 times of cash  Up to 2 times of shares
Value of cash/collateral S$5,000 The valuation of the collateral may differ across different stocks. Assuming final valuation is $5000
Value of share borrowed S$10,000 S$10,000 (up to 2 times)
Margin percentage

Total collateral / Shares borrowed = 150%

(S$10,000 + S$5,000) ÷ S$10,000

Total share value / Shares borrowed = 150%

(S$10,000 + S$5,000) ÷ S$10,000
What happens when there is a margin call?

A margin call occurs when the value of the shares you've borrowed rises above a certain level. This situation requires you to increase your collateral by depositing additional shares or cash into your account to meet the margin requirements.

If Margin Ratio falls  What happens
Between 140%-150% There will be no margin call but no new shares can be borrowed until the margin percentage is restored
Between 130%-140% Margin call to restore the margin percentage in 3 days' time
Below 130% Margin call to restore the margin percentage in 1 day's time
How to Borrow

Step 1

Find out what you can borrow

Check the availability of the stock you want to borrow via your Trading Representative (TR) before shorting. Index components are generally more readily available while smaller cap stocks are limited.

You can find your TR name on iOCBC online trading platform > More > Account Details.

Step 2

Fulfil collateral requirements to get your loan approved

Ensure sufficient collateral (cash or shares) is available in your account before shorting.

Step 3

Sell your borrowed shares

If you are selling your borrowed shares, mark the order as a "short-sell" on your trade ticket.

Step 4

Return the shares

Buy back the shares when it reaches your target price or whenever it suits you and return them to us
Before you apply

Eligibility requirements

Minimum age

21 years and above

Account requirement

Must own a Basic Trading Account

Disclaimers

Risk warning for Securities Borrowing
You should carefully review the securities borrowing agreement/terms provided by your company. Consult your company regarding any questions or concerns you may have with your securities borrowing accounts. When you effect a sell order of securities that you do not own with the intention of buying it at a lower price than you sold it, you are short-selling. You must borrow the relevant quantity of securities sold from the company for delivery at the time of the sale. Accordingly, you are required to open a securities borrowing account with the company. You will have to pay borrowing fees to the company. As between you and the company lending you securities you are not the owner of any of the economic benefits related to the securities borrowed and therefore, amongst other things, any dividends or rights declared during the course of the loan and any rise in the price of the securities borrowed are intended to benefit and belong to the company. You will usually also have to ensure that voting rights attached to the securities borrowed will continue to be exercisable by the owner of the securities lent to you. As you have borrowed securities from the company with collateral provided on a margin basis, all the risks of margin trading (discussed above) are applicable. By borrowing securities to settle your securities delivery obligations you are effectively engaging in short selling of securities – in other words selling securities you do not have. Short-selling is extremely risky. At a certain point in time, you must “close” your short position by buying the same number of shares and returning them to the company. If the price of the securities rises, you have to buy them at a higher price. Since there is no limit to how high a stock can be priced, there is no limit as to how much you can lose. Your losses are therefore potentially without limit. If the stock splits during the course of your short position, you will owe the company twice the number of shares, although the price per share for you to buy immediately after such stock split will generally be significantly lower. The company can demand the return of the securities borrowed at any time.

Important Notes

Trading in capital markets products and borrowing to finance transactions (including, but not limited to leveraged trading or gearing) can be very risky, and you may lose all or more than the amount invested or deposited. Where necessary, please seek advice from an independent financial adviser regarding the suitability of any trade or capital markets product, taking into account your investment objectives, financial situation, or particular needs before making a commitment to trade or purchase the capital markets product. In the event that you choose not to seek advice from a financial adviser, you should consider whether the capital markets product is suitable for you. You should carefully consider and exercise caution in making any trading decision whether or not you have received advice from any financial adviser.

Any reference to a company, financial product or asset class is used for illustrative purposes and does not represent our recommendation in any way. No representation or warranty whatsoever (including without limitation any representation or warranty as to accuracy, usefulness, adequacy, timeliness or completeness) in respect of any information (including without limitation any statement, figures, opinion, view or estimate) provided herein is given by OCBC Securities Private Limited ("OCBC Securities") and it should not be relied upon as such. OCBC Securities does not undertake an obligation to update any information or to correct any inaccuracy that may become apparent at a later time. OCBC Securities shall not be responsible for any loss or damage howsoever arising, directly or indirectly, as a result of any person acting on any information provided herein.

Before you apply

Eligibility requirements

Minimum age

21 years and above

Account requirement

Must own a Basic Trading Account

Disclaimers

Risk Warning for Lending Securities
It is important that you fully understand the risks involved in enabling OCBC Securities Private Limited (“OSPL”) to borrow, on-lend or deliver your securities for OSPL’s discharge of OSPL’s delivery obligations of such securities to third parties. These risks include the following:(a) the borrowing and on-lending of your securities will be on a title transfer basis, which will necessarily mean that you will lose your ownership rights (including voting rights) and title to the same. In its place, you shall only have a right to request for the return of equivalent securities from OSPL; (b) where OSPL may, where relevant, have contractually agreed to use its reasonable endeavours to arrange for any voting rights to be exercised in accordance with your instructions, there is no assurance that such rights will be exercised as you wish, given that you are not entitled to personally exercise any voting rights attached to the securities lent to OSPL during the period of the loan. Therefore, where a significant corporate action or vote occurs while the securities are on loan, you may be unable to personally vote in accordance with your desired outcome or participate in the vote. Where you request for the return of the securities to you for voting, there is a risk that the securities may not be returned in time for you to exercise any voting rights; (c) your claim for the return of equivalent securities is a contractual claim against OSPL. OSPL will provide collateral to secure the obligation to return equivalent securities. Such collateral may be held by OSPL (itself or through any sub-custodian) and may be commingled together with other clients of OSPL on an aggregated and/or omnibus basis, but your interest in such collateral may not be identifiable by separate certificates or other documents or records; (d) there is a risk that any return of equivalent securities by OSPL may not occur on time for various reasons including due to settlement failures, operational errors, or disruptions in market infrastructure. OSPL may also have the right, in certain circumstances such as in an event of your insolvency, to convert the obligation to return equivalent securities to pay you the aggregate market value of the same; and (e) insofar as you will receive manufactured dividends, you may be required to treat the entire amount as income for tax purposes.

FAQs
Common questions
What is share borrowing?

Share borrowing is a loan of securities to a trader who will use the borrowed shares to sell in the ready market. Later, when your target price of the stock has been reached, you buy the shares back and return the borrowed stocks.

Traders typically engage in this strategy when they expect the price of a certain stock to fall in the near future and would like to take advantage of the falling price. If their prediction is correct, the difference between the initial higher selling price and the lower buying price will be the profit.

Where are the shares borrowed from?

When you hold a share borrowing account with us, this gives you the access to borrow shares from us. Generally, index components are readily available for borrowing while smaller cap stocks are limited but the list of securities and their respective quantity available for borrowing may differ from time to time. You can get an update on the latest information from your Trading Representative (TR). ​

What is the borrowing fee?

The borrowing fees are accrued  (but not compounded) on a daily basis and collected from you monthly. Here is how they are calculated:

Borrowing fee = Market Value X Borrowing Rate (The borrowing rate is 7.77% per annum, subject to GST.)

where 

Market Value = Last Done Price x Quantity Borrowed

How much collateral do you need?

Our borrowing is leveraged, meaning you can borrow more than your pledged collateral amount. Here is how you calculate the borrowing limit based on the amount and type of collateral:

Borrow Limit 2 times of cash Up to 2 times of shares
Value of cash/collateral S$5,000 The valuation of the collateral may differ across different stocks. Assuming final valuation is $5000
Value of share
borrowed		 S$10,000 S$10,000 (up to 2 times)
Margin percentage Total collateral/shares borrowed = 
150%
(S$10,000+S$5000)÷ S$10,000		 Total share value/shares borrowed = 150%
(S$10,000+S$5000)÷ S$10,000
What is the borrowing rate?

Borrowing rates differ according to the stocks borrowed. Please check with your Trading Representative on the different borrowing rates.

How do I opt in to the securities lending facility?

Reach out to your Trading Representative to provide you with the consent form, which grants OCBC Securities permission to lend out your eligible securities. By doing so, you are giving us your approval to exercise 100% discretion over the securities lending process.

Please note that this is a one-time consent, and you will not need to provide approval for each subsequent securities lending transaction. Once we receive your signed consent form, we will be able to lend out your eligible securities and you will be able to participate in the securities lending facility.

How do I know that my securities have been successfully loaned to OCBC Securities?

You will be notified by your Trading Representative once you are eligible for the securities lending facility. If your securities are loaned out, you will see the lending interest breakdown in your monthly e-statement under shares borrowing account on iOCBC trading platforms.

How do I stop the shares lending program?

If you wish to opt-out of the securities lending facility, please reach out to your Trading Representative. They will assist you in terminating the securities lending arrangement and ensure that no further securities lending transactions are conducted on your behalf.

FAQs
Common questions
What is share borrowing?

Share borrowing is a loan of securities to a trader who will use the borrowed shares to sell in the ready market. Later, when your target price of the stock has been reached, you buy the shares back and return the borrowed stocks.

Traders typically engage in this strategy when they expect the price of a certain stock to fall in the near future and would like to take advantage of the falling price. If their prediction is correct, the difference between the initial higher selling price and the lower buying price will be the profit.

Where are the shares borrowed from?

When you hold a share borrowing account with us, this gives you the access to borrow shares from us. Generally, index components are readily available for borrowing while smaller cap stocks are limited but the list of securities and their respective quantity available for borrowing may differ from time to time. You can get an update on the latest information from your Trading Representative (TR). ​

What is the borrowing fee?

The borrowing fees are accrued  (but not compounded) on a daily basis and collected from you monthly. Here is how they are calculated:

Borrowing fee = Market Value X Borrowing Rate (The borrowing rate is 7.77% per annum, subject to GST.)

where 

Market Value = Last Done Price x Quantity Borrowed

How much collateral do you need?

Our borrowing is leveraged, meaning you can borrow more than your pledged collateral amount. Here is how you calculate the borrowing limit based on the amount and type of collateral:

Borrow Limit 2 times of cash Up to 2 times of shares
Value of cash/collateral S$5,000 The valuation of the collateral may differ across different stocks. Assuming final valuation is $5000
Value of share
borrowed		 S$10,000 S$10,000 (up to 2 times)
Margin percentage Total collateral/shares borrowed = 
150%
(S$10,000+S$5000)÷ S$10,000		 Total share value/shares borrowed = 150%
(S$10,000+S$5000)÷ S$10,000
What is the borrowing rate?

Borrowing rates differ according to the stocks borrowed. Please check with your Trading Representative on the different borrowing rates.

How do I opt in to the securities lending facility?

Reach out to your Trading Representative to provide you with the consent form, which grants OCBC Securities permission to lend out your eligible securities. By doing so, you are giving us your approval to exercise 100% discretion over the securities lending process.

Please note that this is a one-time consent, and you will not need to provide approval for each subsequent securities lending transaction. Once we receive your signed consent form, we will be able to lend out your eligible securities and you will be able to participate in the securities lending facility.

How do I know that my securities have been successfully loaned to OCBC Securities?

You will be notified by your Trading Representative once you are eligible for the securities lending facility. If your securities are loaned out, you will see the lending interest breakdown in your monthly e-statement under shares borrowing account on iOCBC trading platforms.

How do I stop the shares lending program?

If you wish to opt-out of the securities lending facility, please reach out to your Trading Representative. They will assist you in terminating the securities lending arrangement and ensure that no further securities lending transactions are conducted on your behalf.

How to apply

Open a Share Lending and Borrowing Account today

Apply Now

or get in touch with us.

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