SCG offers specialized services to help clients access liquidity, manage investments, and generate extra income. These services can be divided into securities-based lending and fully paid securities lending programs.

 

Securities-based lending

This service allows clients to use their investment portfolios as collateral for a lump-sum loan. Special services associated with securities-based lending include: 

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• Quick access to cash. Clients can access funds within a few days, which is much faster than applying for a traditional loan.

• Investment continuity. Instead of selling assets and triggering potential capital gains taxes, clients can borrow against their investments. This allows them to keep their long-term investment strategy intact and continue benefiting from potential market gains, dividends, and interest.

• Flexible financing. The funds acquired through securities-based lending can be used for a wide range of purposes, such as buying real estate, funding a business, consolidating debt, or paying taxes.

• Competitive interest rates. Because the loan is secured by highly liquid assets, the interest rates are often more favorable than those for other forms of credit, such as unsecured personal loans or home equity lines of credit (HELOCs).

• Flexible repayment options. Securities-backed lines of credit often feature flexible repayment schedules and typically do not have a fixed maturity date. ​

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Fully paid securities lending

This service allows clients to lend out fully paid securities they own to other market participants, such as hedge funds and other financial institutions. The special services offered to clients through these programs include: 

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• Passive income generation. Clients can earn additional revenue through interest payments on stocks they already own but do not plan to sell in the near term. For "hard-to-borrow" stocks that are in high demand, the lending rates can be very lucrative.

• No change in ownership. The client remains the economic owner of the stock while it is on loan. This means they can sell the stock at any time and still receive all market gains or losses.

• Maintaining economic benefits. Clients receive "cash-in-lieu" payments that are equivalent to any dividends paid on the loaned stocks.

• Risk mitigation. The lender requires the borrower to post collateral—often 102% or more of the value of the borrowed securities—which is monitored and marked-to-market daily. This minimizes the risk to the client if the borrower defaults.