By Carmine Salute, Head of Commercial Development, Americas

I recently wrote about what clients are demanding and how the conversation in North America has shifted from 'why automate?' to 'how fast can you get us live?'. That shift is only accelerating.

Across the US and Canada, I am seeing a market that has already made up its mind and is now focused entirely on execution, to gain faster, more accurate and smarter operations. The word is out that Pirum TradeConnect, combined with our Post Trade Services platform, has achieved bid-to-settlement in under 30 minutes. That is the operational reality for firms that have connected their pre- and post-trade infrastructure through a single platform, and forward-looking firms are jumping on to this train.

<30 mins

Bid-to-settlement for Pirum TradeConnect clients with the right configuration

Source: Pirum TradeConnect client data

But, along the way, my team had already started looking closely at this issue some time ago, having identified that, if it were to happen, the ramifications for US firms and international firms alike would be far-reaching.

SEC Rule 15c3-3: confirmed

On the last day of Q1 2026, the SEC confirmed it: this is now real. The SEC’s Order under Rule 15c3-3 should now be on the radar of every North American Securities Lending desk.

The so-called Customer Protection Rule has created a significant divide between US and global Securities Lending for decades. Its collateral restrictions mean that US broker-dealers borrowing customer securities are limited in the collateral types they can post. Specifically, domestic equities are not currently eligible. The result: operationally intensive workarounds, limited triparty adoption, and higher costs relative to global peers where equity collateral is standard practice.

That divide is significant in scale. While equity collateral is standard practice in international Securities Lending markets, US broker-dealers operating under Rule 15c3-3 remain restricted to cash, US Treasuries, and letters of credit. Hence, US market participants face higher costs, limited triparty adoption, and a structural competitive disadvantage relative to global peers.

" US desks, operating under the most restrictive collateral rules of any major market, have had to manage workarounds that add cost, complexity and operational overhead. "

– Carmine Salute, Head of Commercial Development, Americas

The Order has now evolved. Broker-dealers may pledge diversified baskets of Russell 1000 and/or S&P 500 equity securities as collateral when borrowing fully-paid or excess margin equity securities from Qualified Institutional Securities Lenders. The collateralization requirement is 101% for major currency securities and 105% for others – with daily mark-to-market required.

The equity collateral universe spans approximately 1,500 securities across the two indices and can include unleveraged ETFs tracking either index. The operational and capital efficiency implications are significant: equity collateral eligibility is expected to materially reduce capital requirements for Securities Lending under Basel III, given the lower risk weights applicable to equity-for-equity secured transactions versus cash-collateralized ones.

Pirum is well placed to help customers navigate what comes next. With 25 years of experience facilitating clients’ use of equity collateral for Securities Lending internationally, and connectivity across all major triparty agents, we are well positioned to fast-track the operational integration of equity collateral under the new Order.

The complexity that 15c3-3 introduces – daily mark-to-market, concentration and diversification monitoring, index composition changes, corporate actions across hundreds of positions – is precisely the kind of operational challenge our platform is built to handle at scale. And, indeed, has been handling for our non-US based clients for over 25 years.

We have already published a snapshot of what the SEC announcement and what it means for affected firms. We are preparing in-depth analysis of what this means for your firm, your book and your operations.

 

Also included in the Quarterly Panorama:

 - Ben Challice's reflections from the Bangkok conference, and what PASLA's rebrand to SFAAP signals about where APAC securities finance is heading
- Duncan Carpenter on what the EU and UK T+1 roadmap are already telling us about preparation timelines
- Jonathan Ford on Fixed Income's golden opportunity: T+1, mandatory UST clearing, and why the moment to modernise is now

The Panorama also includes a regulatory and events calendar and a product news section.