Neither the Commonwealth Bank of Australia (nor its subsidiary CommSec) participates in any securities lending of our margin lending clients’ stock.
The suspension of some brokers from providing stockbroking services on the ASX due to claimed internal stock and cash movement irregularities has left some investors nervous about their margin loan positions. Our margin lending clients can be confident that their holdings are not exposed to any such irregularities.
The Commonwealth Bank of Australia is the actual lender of CommSec Margin Loans. CommSec administers the CommSec Margin Loan on behalf of the Commonwealth Bank of Australia. Unlike a number of margin lenders, the Commonwealth Bank of Australia is an approved deposit taking institution regulated by the Australian Prudential Regulation Authority (APRA). It applies extremely rigorous risk and compliance standards in relation to CommSec Margin Loans. Further, the Commonwealth Bank of Australia conforms to the Code of Banking Practice, and therefore the code applies to its margin loans.
Your CommSec CHESS-sponsored holdings, including those that are security for your margin loan, are in your name, and cannot and will not be on-lent by the Commonwealth Bank of Australia, or on its behalf by CommSec.
The Commonwealth Bank of Australia has a stringent market risk policy framework around its margin lending practices.
