UBS provide a PB service and one of the largest in this country....

UBS provide a PB service and one of the largest in this country. The shares they took from Regal are held as collateral against any borrowed funds or shorts Regal has itself with the PB. Under the agreement, UBS can use these shares to lend out to other funds that want to short PLS themselves. If Regal are in a position where they can recall their stock, UBS will have to recall it themselves from the groups they've lent the stock to first, then return it to Regal themselves. UBS are obliged to return PLS and aren't the ones that have to cover the shorts. If the other party is late on recall or doesn't meet delivery, UBS will close out automatically by buying stock and returning to Regal, charging any costs and to the shorting fund. This other fund posts collateral themselves so UBS holds sufficient funds to force a closing of the position. It is extremely rare for the PB to return a similar stock and to do so is bad business. I have never heard of it happening. You give PLS (or other) and expect it back at time.

The reason why Regal and UBS post subs is that Regal owns 5% legally so must submit the notice. When Regal give the stock to UBS, they went over and posted their sub. In this circumstance, Regal still has beneficial ownership, however, UBS has legal control of it as per their agreement. Both file subs owning the same exact shares.

Of interest. For all the positive talk on Regal going sub and the trashing of the shorters, Regal are a massive shorter of stocks on the ASX. Most of the leverage in there funds is from shorting, not borrowing cash and going longer. Simply, when you borrow stock and then short, you receive the cash from the sale. This cash is held with the PB and can be used to buy another stock long. In this case you are 100% long, 100% short, which results in the gross exposure (long + short) of 200%, or 2x leverage. Regal's flagship strategy that has most of their FUM is a market neutral strategy which is geared at least 3x to 4x. This means for every dollar they go long, there is a corresponding short sale, with the long stock often held as collateral against the short in addition to some extra capital as a buffer.