Shinhan iTAS Signs MOU with Directional to Promote Stock Lending and Borrowing Transactions

[Asia Economy Reporter Minji Lee] Shinhan iTAS announced on the 6th that it signed a "Memorandum of Understanding (MOU) for the Mutual Development of Stock Lending and Borrowing Transactions" with Directional at the Shinhan iTAS headquarters in Yeouido.

Shinhan iTAS is a leading company in capital market fund infrastructure, providing trust asset fund accounting management and value-added services to over 200 institutions including comprehensive asset managers, specialized private equity managers, pension funds, insurance companies, REITs, AMCs, and securities firms. Directional is a fintech company offering a platform service that enables individual investors to easily short sell stocks through P2P stock lending and borrowing among individual investors.

This business agreement is expected to bring significant changes to institutional stock lending and borrowing transactions. Previously, stock lending and borrowing transactions were conducted between institutions via messenger, but going forward, Shinhan iTAS’s trading system will provide various convenient functions beyond existing operations, including compliance features such as storage and inquiry of transaction records. Also, while securing the necessary lending volume during trading hours previously required long waiting times, lending pools formed in the market will now be provided through the system, enabling real-time transactions. These real-time transactions and enhanced compliance functions are also expected to help prevent naked short selling in advance.

In the future, the two companies plan to develop additional services to activate short selling for individual investors by advancing stock lending and borrowing services, and to grow the lending and borrowing market through securities firms together.

Kim Chang-su, Executive Director of the DT New Business Promotion Headquarters at Shinhan iTAS, said, “Through the strategic business agreement with Directional, we are now able to provide stock lending and borrowing services through our system.” He added, “We will continue to build a win-win cooperation system with fintech companies equipped with various technologies to transform into a capital market infrastructure platform business that offers convenient services to customers and lead the financial market.”