IB users who lend out their long shares..

[yeahso]

The shares will be recalled based on settlement projections (which may suggest we have, or will have, shares available to lend at that time) and a buy in executed if they aren’t returned. There is a chance that the buy in might not settle in time to make delivery on the closing sale, however, there are clearinghouse provisions which effectively recognize this lag and ensure that the end client is not impacted.

Is that clearing house provisons only cover US market? How about for HK market as there is a so call CCASS CNS rules that the sold stock has to be delivered on S/D to CCASS otherwise a compulsory buy in on T3 will be made. As I know participant can claim a buyin exemption but for the case of loaned shares not delivered back on time resulting a net short to CCASS on S/D for a particular stock is not qualified as the exemption criteria. How could IB scheme aviod such situation?
Sorry I am not quite familiar please correct anything I stated wrongly. Thanks

 

[IB-AN]

Every clearinghouse, including HKSCC, has provisions to deal with member delivery fails and those provisions can include forced buy in by HKSCC. The point being made here is that we maintain a sophisticated inventory management system that makes shares available for delivery, recommends borrows, and maximizes use of inventory in all jurisdictions while satisfying clearinghouse obligations in a regulatory complaint manner.