Agent Lending

Oversight Checklists

As a follow-up to the article, A Best Practice Oversight Approach for Securities Lending, which has appeared in J.P. Morgan’s Thought publication as well as Securities Lending Times, we have developed control checklists to be used as a guideline by our clients. These checklists are designed to provide clients with the tools necessary to easily monitor and oversee various aspects of their agent lending program.

The checklists, which illustrate all of the metrics discussed in the oversight article, are divided into three main sections: lending, collateral, and program performance. Each section provides a list of metrics, a description of each metric, the reason/purpose for monitoring each metric, the J.P. Morgan ACCESS® report that best illustrates the metric and a date completed column to be filled in by the client. The checklists, which can be downloaded in PDF format below, allow clients to amend the “Date Completed” column only. However, clients that are interested in having additional components on the checklists can obtain a customizable Excel version from their agent lending relationship manager.

Clients should be aware that these control checklists are merely intended as a guide and, depending on their agent lending program’s level of sophistication and size, additional oversight may be warranted. Furthermore, it is highly recommended that clients meet periodically (e.g., quarterly, semi-annually or annually) with their agent lending relationship manager and conduct a full review of their program, discuss in greater detail the market environment and performance (e.g., borrower demand, loan balances, risk analysis, spreads, earnings, collateral/investment, operational issues), and review J.P. Morgan’s overall agent lending program.

The ACCESS reports listed on the control checklists are only a small subset of the more than 75 standard reports that are available to clients. In addition, the reports can be easily customized to meet a client’s requirements and J.P. Morgan continues to upgrade and enhance the reporting capabilities. While clients are encouraged to utilize ACCESS, we understand that certain clients have constraints on their time or resources. In this case, your J.P. Morgan agent lending team is always available to assist you with creating reports and setting up ACCESS to electronically schedule and send reports to you.

A monitoring and oversight approach that is built on the principles of on-going education, consistent communication, targeting specific goals and utilizing detailed reporting will allow clients the opportunity to gain greater confidence in their agent lending program. Using these control checklists should enable clients to better understand all aspects of their program and provide them with the necessary tools to better assess risk and return dynamics. 

Securities Lending Control Checklists

By Joshua Lavender, Executive Director, agent lending, J.P. Morgan

All right, title and interest in and to the checklists belong solely to J.P. Morgan. The checklists may be used for your own, internal use only and you may not distribute the checklists externally. J.P. Morgan does not (i) provide any representation or warranty, express or implied, for the checklists, (ii) take responsibility for any errors and omissions in the checklists, or (iii) accept any liability whatsoever for any loss arising from the checklists.


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