Insight
July 2026
The Purple Issue 23
Geopolitical Volatility Drives a Record $9.1 Billion in H1 2026
The global securities lending industry just wrapped up its strongest first half on record. Driven by persistent macro uncertainty, geopolitical flashpoints, and an expanding revenue base, EquiLend Data & Insights tracked an unprecedented $9.1 billion in H1 revenue, a 34% jump year-on-year.
While 2025 focused on isolated, high-fee opportunities, H1 2026 thrived on broad, relentless demand. Loan balances hit a record $4.38 trillion, underlining the massive scale of market engagement throughout the period.
The growth spanned across the entire ecosystem:
- Lender-to-broker activity generated $6.99 billion (up 34% YoY), while broker-to-broker lending added $2.11 billion (up 33%).
- Equities led the charge, climbing 38% to $5.43 billion, while fixed income delivered a strong $1.57 billion (up 22%).
- Across EquiLend’s NGT platform, Q2 alone saw a record 11.85 million trades and $14.58 trillion in notional processed, with NGT’s H1 market share rising to 66.4% from 61.6% a year prior, capturing approximately 95% of all new market trade growth.
This momentum only picked up steam as the half progressed. Q1 opened strong at $3.84 billion (up 31% YoY), and Q2 built right on top of it with a further $5.26 billion. Ultimately, the same core themes shaped the entire six-month period, with energy market volatility from Middle Eastern tensions, rising sovereign yields, and aggressive AI trade rotation keeping demand high all the way through June.
North American Equities: From the Iran Shock to the AI Unwind
North American equities remained the dominant securities finance revenue earner, despite the APAC surge, generating $2.32 billion in H1 2026 revenue, an 11% increase year-on-year. This broad-based recovery was fueled by AI-driven volatility, biotech event activity, and steady demand for credit ETFs.
The U.S. market remained dominant, accounting for 92% of the region’s first-half equity revenue. By sector:
- Technology continued to lead, generating $447 million in H1 despite a 12% drop from last year.
- Energy was the standout narrative. First-quarter revenue surged 53% year-on-year as supply shocks from the Iran conflict triggered sustained short positioning.
At the security level, Infosys ADR (INFY US) led both North American equities and global markets, generating $107 million as reshoring narratives kept short interest high. Other top performers included:
- TopBuild Corp (BLD): Generated $55 million across the half, emerging as a particular standout in Q2 due to a dramatic increase in lending activity following an acquisition agreement with QXO at the end of June.
- Lucid Group (LCID US): Contributed $43 million amid ongoing EV sector uncertainty.
- LQD and HYD: The fixed income ETFs featured prominently among top earners, reflecting their expanding role as macro hedging tools in a volatile rate environment.
The quarter also captured a significant structural volume event: the June semi-annual Russell reconstitution acted as a key driver for a single-day U.S. equity peak of 121,800 trades on NGT on June 29, the highest daily count recorded for the region. The synchronized global nature of that peak, with EMEA also hitting its regional high on the same date, pointed to coordinated institutional flow rather than isolated opportunistic activity.
APAC Equities: Semiconductors, Sanctions and a Historic May
Asia-Pacific equities followed closely behind North America, generating $2.12 billion in H1 lending revenue, a mammoth 74% year-on-year gain. Notably, the region made history in May by topping North America for monthly revenue for the first time, bringing in $425 million. The growth in the first half of 2026 was driven by a 55% surge in loan balances to $335 billion, with average fees remaining high at 127 bps. The AI boom and semiconductor demand provided a powerful structural tailwind across multiple sectors.
The top regional stories included:
- Taiwan: Led the region with $635 million. Intense semiconductor demand drove technology positioning, with IT equities making up 36% of APAC’s total revenue.
- South Korea: Emerged as the standout growth story, with revenue skyrocketing 180% as the market continued to expand following the lifting of shortselling restrictions in H1 2025.
At the individual security level, Hong Kong-listed names dominated short interest:
- Pop Mart International (9992 HK): Was the top-earning security in Asia, generating $55 million as short interest intensified around the collectibles company.
- Contemporary Amperex Technology (3750 HK): Added $47 million, keeping short sellers engaged amid ongoing trade policy headwinds and supply chain tensions.
The scale of APAC’s revenue performance was reflected in platform activity. NGT recorded APAC notional growth of 63.1% year-on-year in Q2, with non-GC notional surging 125.1% year-on-year. APAC specials revenue reached $982 million year-to-date through May (up 73% YoY), driven by persistent name-specific demand across Japan, Taiwan, and South Korea, as well as IPO-linked borrow activity from Hong Kong’s active primary market.
EMEA Equities: Event-Driven Demand Pushes Revenue to $959 Million
EMEA equities were the biggest year-on-year mover, generating $959 million in H1 2026 lending revenue, a massive 62% jump driven by notable increases in both fees and loan balances. This growth was already well established heading into mid-year, after Q1 delivered a 68% year-on-year increase.
Regionally, the growth story was highly diversified:
- Germany was the standout national market, generating $132 million (up 96%), with Sweden, the U.K., and France also contributing meaningfully.
- Industrials and Financials led at the sector level, rising 70% and 46% year-on-year respectively. Energy shocks and rising rate expectations fueled financials, while soaring defense budgets and geopolitical industrial policies drove activity in industrials.
- Event-related demand for specific names drove the highest revenue. Koninklijke Philips and Telecom Italia were the region’s headline contributors, both attracting heavy short interest as corporate restructurings and strategic uncertainty kept short sellers active.
Despite the strong revenue performance, NGT data points to a region with one eye on the future. EMEA trade count grew 17.1% year-on-year, materially below APAC and U.S. growth rates, as preparation for the European T+1 settlement transition, scheduled for October 2027, continues to absorb significant operational capacity across the region.
Global ETFs: An Ever-Increasing Role in Volatile Markets
ETF lending revenue reached $405 million in H1 2026, a staggering 62% increase year-on-year, cementing the asset class’s role in the securities lending ecosystem. While North America remains the dominant user, returning $334 million, uptake is expanding globally with every region posting gains of over 50%.
The primary revenue drivers highlighted the market’s need for liquid hedging tools:
- Fixed Income ETFs: Standout performers like the previously mentioned LQD and HYD ranked among the top global earners, reflecting heavy demand from institutions expressing quick rate and credit views.
- Leveraged ETFs: Emerged as powerful hedging vehicles as high-volatility single-stock plays drew massive short interest from investors, with examples such as Direxion Daily TSLA Bull 2X ETF (TSLL) generating $12.9 million for lenders and $8.4 million for the GraniteShares 2X Long NVDA Daily ETF (NVDL).
The structural shift in ETF usage was equally visible on NGT, where ETFs were the highest-growth sub-segment within equities at +34.3% year-on-year. Active ETFs now outnumber passive by roughly 5:1 by product count globally, and growing participation from Bitcoin and crypto ETFs is adding a new source of borrow demand to the ecosystem.
Fixed Income: Inflation, Issuance, and the Sovereign Stress
Fixed income lending revenue reached $1.57 billion in H1 2026, up 22% year-on-year, with higher-for-longer rate expectations, elevated sovereign issuance and widening credit spreads all contributing to a strong half across the asset class. Key highlights included:
- U.S. Treasuries: Rose 30% to $693 million as investors positioned around inflation risk and Federal Reserve uncertainty.
- French OATs and U.K. Gilts: Up 24% and 29% respectively, as fiscal pressures and high issuance drove yields and lending demand in tandem.
- Corporate Bonds: Generated $417 million (up 11%), with a 36% surge in North American investment-grade balances driving a 39% revenue uplift in that segment alone.
On NGT, convertible debt was the standout fixed income story, rising 24.4% year-on-year. With global convertible issuance more than doubling in Q1, driven largely by AI infrastructure financing, the resulting arbitrage activity fed directly into equity lending demand across the half.
Looking Ahead: Building on a Record Half
H1 2026 has demonstrated the securities lending market at its most dynamic, with record balances, broad-based revenue growth, and meaningful contributions from across regions, asset classes, and sectors. Where 2025 relied on isolated opportunity, H1 2026 thrived on relentless, widespread demand.
The macro forces that drove it, geopolitical tension, rate uncertainty, and supply shocks, show little sign of abating, and two structural milestones loom large: the U.S. Treasury clearing deadline on 31 December 2026 and the European T+1 go-live in October 2027. For a market that has just delivered its strongest first half on record, the direction of travel looks firmly established.
You may also like:
The Purple
Inside the Financing Markets: The Purple Issue 23 explores what's driving this...
Read More
2026: The AI Trade Grows Up
Six months ago, we wrote about how AI-linked equities had redefined the...
Read More
Return of the IPOs: H1 2026’s Record Listings Through a Securities Finance Lens
H1 2026 was one of the most active periods for new equity...
Read More