Embracing the Future

BBH is pleased to announce that Tom Poppey, Global Head of Securities Lending Product Development and Client & Program Management at BBH, will serve as co-chair of the 2018 PASLA/RMA conference which kicks-off next week in Hong Kong.  Tom recently spoke with Securities Lending Times to share his views on the major trends influencing the Asian securities lending landscape and what to expect at this year’s conference. 

Of all the global forces affecting Asia, which are the most pertinent this year?

Asia continues to present a great opportunity for growth due to the steady expansion of locally-domiciled investment products and the continued emergence of securities lending as an important element of strong capital markets. The desire to unlock new areas of revenue is particularly present in Asia and will continue to be so in 2018. Another trend will be a focus on greater business transparency, both in terms of the regulatory mandate as well as a growing demand by beneficial owners. The need for more information is only increasing as the ease by which investors can consume data and produce insightful analytics grows.

How are these factors represented in this year’s agenda? And what topics are you looking forward to hearing about at the conference?

The conference planning committee has focused on ensuring the business program reflects both global themes as well as regional considerations. Many of the panels in fact focus on driving new commercial opportunities such as the future of China and its impact on Hong Kong along with a discussion on the key attributes that contribute towards a successful lending market. Of course, no discussion on lending is complete without considering the real impacts of changing regulation or balancing the need to manage return within acceptable risk parameters, both of which I anticipate will be spirited discussions.

Like many capital market businesses, the potential for change in light of innovative technologies is ever present in our industry. I particularly look forward to the panel discussion on the disruptive path of financial technology, or ‘fintech’. There are many examples where technology has reduced risk and improved the scale of our industry, such as post-trade comparison services and the growth of automated trade execution, but the potential introduction of artificial intelligence and machine learning represent unexplored areas of impact. The planning committee has also identified two great, and very different, keynote speakers that should offer unique insights.

Why did you decide to organize the conference in Hong Kong? And how has its securities lending market developed in the past 12 months?

Hong Kong is a natural choice of venue given its high concentration of industry participants from beneficial owners to agent lenders, borrowers and ultimately end users of borrowed securities. The country enjoys standing as a vibrant and key lending market in the region. And of course, Hong Kong is an important capital market with a view into the second largest economy in the world.

What will be the top securities lending trend this year?

The Asian securities lending market has experienced notable growth in recent years, and we should see the trend of increasing returns from the region continue this year, providing additional alpha for investors globally. I would also expect the growth of Asia-domiciled investment products to increase due to positive capital flows, particularly from the US, and demand from local, regional investors to achieve greater returns.

Read the full interview in the February 20th issue of SLT.

The 15th Annual PASLA/RMA conference will take place on 6-8th March at the J.W. Marriott Hotel Hong Kong. Representatives from BBH will be attendance, including conference co-chair Thomas Poppey, Robert Lees, Zubair Nizami, and Garrett Berkery. We hope to see you there.