The Mercer Sentinel Group has extensive experience consulting to institutional investors on all aspects of securities lending programs including identifying the most appropriate:

• route to market
  
  
• advising on program structures
  
  
• evaluating and selecting lenders
  
  
• assessing and benchmarking lending operations and controls; and
  
  
• assessing lending revenue estimates.

During a needs assessment, we examine the client’s risk tolerances, revenue expectations, any existing lending arrangements and potential changes being considered, such as the introduction of third-party lending agents, principal lending relationships or other lending platforms. We supplement our analysis by conducting reviews and assessments of lending agents and principal borrowers.

In addition to providing a thorough assessment of a lending provider’s capabilities, its internal control structure and collateral management; we also assess the reasonableness and competitiveness of lending revenue estimates. Our experience indicates that these estimates can vary significantly, largely due to differing assumptions used to generate estimates, but also due to intrinsic differences in lending capabilities. To ensure transparency during an evaluation and to facilitate consistent comparisons, we validate assumptions, isolate issues and highlight material differences between assumptions and capabilities.

Once a program is established, we use industry benchmark data to validate securities lending revenues and to conduct ongoing risk and performance monitoring.

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Not investment advice
This does not contain investment advice relating to your particular circumstances. No investment decision should be made based on this information without first obtaining appropriate professional advice and considering your circumstances.