PASLA: APAC Market Flows
12 March 2026 Thailand
Image: themorningglory/stock.adobe.com
The 2026 Annual Conference on Asian Securities 麻豆影视传媒, held by the Pan Asia Securities Lending Association (PASLA) in Bangkok, unpacked the securities finance market across APAC, discussing regional flows, issuance, hedging, and the continued growth of derivatives and directed trading.
2025 into 2026 has been a 鈥渟tandout year鈥� stated one panellist, who highlighted that assets under management, balance increases, and revenue increases have been hitting all-time highs.
They also noted that direct investments into hedge funds have increased, including the growth of separately managed accounts (SMAs) and spin off seed funds. As a result, this has put increased requirements on firms to 鈥渟weat鈥� assets more, in addition to increased asset requirements, balance sheet requirements, and funding requirements 鈥� all in an environment where capital is constrained.
鈥淚n terms of outlook for 2026, it is a very consistent message. It is trying to monetise assets for beneficial owners, monetise their balance sheet, and monetise their funding capabilities in a capital-efficient manner that helps us scale and leverage relationships,鈥� the panellist adds.
From a sovereign wealth perspective, the securities financing industry has continued to evolve in terms of the spectrum of products being presented, with one speaker noting that, over the years, it has changed from securities lending to securities financing in order to include synthetic as well as physical transactions.
In terms of collateral evolution, the panellist noted that more markets, including Taiwan and Korea, have demanded to be collateralised.
Discussing Hong Kong, one panellist stated, in terms of liquidity, the market is only improving. Another speaker agreed, stating the balances in Hong Kong highlight the demand for financing.
Moving the discussion forward, the panellists were asked if the 鈥淜orea issue is beating a dead horse鈥�, referencing the region鈥檚 previous bans on short selling, and strict market regulations.
Panellists disagreed, with one stating: 鈥淭here has been phenomenal growth since the short selling ban was lifted in March last year, resulting in an increased requirement for funding.鈥� They added that the opportunities created by this are positive, allowing people to swipe their balance sheets with their funding capabilities.
They highlighted that lifting the ban has allowed firms to release new strategies in Korea. The panellist looks at the region as a 鈥渟uccess story鈥� despite its challenges and regulatory backdrop, highlighting that both institutional investor and retail participation is up. 鈥淭here is still more to come, so watch this space,鈥� he concluded.
鈥淪ecurities finance continues to evolve in terms of platforms, demand, and settlement cycles. The time to market and for the full lifecycle to complete is changing, and I would not say it is synchronised yet, it is still very fragmented,鈥� the moderator stated. They compared APAC鈥檚 markets to those more developed in Europe and the Americas, and asked: but what else is out there in terms of securities finance lending platforms?
There are multiple components within securities financing platforms, whether it be technology, operational efficiency and connectivity, or engagement. One perspective on the panel noted the increasing degree of sophistication in their client base. As the client base grows, the speaker noted that firms must consider client use cases in every one of those platforms, which need to be supported by a technology stack, and an investment tool that enables scale, flow, and resilience. They concluded that innovation as well as resiliency is integral to the market.
鈥淣o panel is complete without the mention of AI,鈥� a panellist continued. This technology has already started to prove it is the accelerator regarding how much of the innovation gets managed, they explained. The panellist stated they feel as though 2026 will continue to be a year of innovation: 鈥淢any years ago it was a securities lending conference, now it is a securities finance conference, and that reflects the innovation that we continue to see.鈥�
During the discussion, it was noted that Korea has extended its trading hours by different exchanges, and this is going to continue, meaning operational friction is now a competitive disadvantage requiring automation across the lifecycle to allow firms to predict utilisation, cost, balance sheet, and shortfall of inventory.
Discussing the move to shorter settlement cycles, a speaker stated this will drive the need for quicker cloud mobility and a more resilient and motivated front-to-back settlement and finance process, noting that is where investment technology is going to continue. 鈥淭+0 creates challenges, but it is good testing prep.鈥�
When talking about innovation in securities financing, panellists were asked what would be most beneficial to each of them. One person said they would like data-driven decision making to allow them to forecast market trends and understand flows, allowing them to anticipate needs and efficiently manage them, rather than reacting.
This led to panellists being asked if they view emerging technologies as embellishments to allow people to make better decisions, rather than replacing humans.
The consensus showed that allowing AI to make more 鈥渃hallenging鈥� decisions will be beneficial for everyone, and that by developing technology to take on the more onerous responsibilities, humans are able to spend more time thinking about client needs while not being 鈥渙verloaded with information鈥�, therefore making more informed decisions.
Shifting the conversation to the war in the Middle East, the panellists were asked about its impact on markets, and to what degree it has redefined market paradigms.
鈥淚t is very difficult to forecast,鈥� noted one panellist, who highlighted that over the last week there has been increased volatility because of the geopolitical climate, and it is something that will be watched very closely. Another speaker agreed that it is currently too soon to predict the outcome, however they do not feel as though it will change the immediate dynamic of funding requirements, but rather put a different spin on it.
One panellist drew a comparison between two types of markets, stating there is a subset of markets that are fundable through triparty and synthetics, or physical and synthetic forms. Within these markets the question is more about where the supply comes from, as opposed to how do you finance it, and how do banks and brokers source that funding requirement and that supply in a way that is optical for their constraints. They note there is another cross section of markets where it is more challenging to finance, where there are barriers to how you could typically have a traditional finance market driven by infrastructure, regulation, and tax such as Taiwan and Korea. They state it is those complexities and constraints that drive innovation in the market, noting Taiwan is a 鈥渇antastic鈥� example.
The panel concluded that no one market is the same, highlighting that issues are not consistent across markets. 鈥淚f you take China or India, there is no physical finance market that is permissible for foreign institutional investors,鈥� stated one speaker, who underscored that it is an infrastructure and legislative problem.
2025 into 2026 has been a 鈥渟tandout year鈥� stated one panellist, who highlighted that assets under management, balance increases, and revenue increases have been hitting all-time highs.
They also noted that direct investments into hedge funds have increased, including the growth of separately managed accounts (SMAs) and spin off seed funds. As a result, this has put increased requirements on firms to 鈥渟weat鈥� assets more, in addition to increased asset requirements, balance sheet requirements, and funding requirements 鈥� all in an environment where capital is constrained.
鈥淚n terms of outlook for 2026, it is a very consistent message. It is trying to monetise assets for beneficial owners, monetise their balance sheet, and monetise their funding capabilities in a capital-efficient manner that helps us scale and leverage relationships,鈥� the panellist adds.
From a sovereign wealth perspective, the securities financing industry has continued to evolve in terms of the spectrum of products being presented, with one speaker noting that, over the years, it has changed from securities lending to securities financing in order to include synthetic as well as physical transactions.
In terms of collateral evolution, the panellist noted that more markets, including Taiwan and Korea, have demanded to be collateralised.
Discussing Hong Kong, one panellist stated, in terms of liquidity, the market is only improving. Another speaker agreed, stating the balances in Hong Kong highlight the demand for financing.
Moving the discussion forward, the panellists were asked if the 鈥淜orea issue is beating a dead horse鈥�, referencing the region鈥檚 previous bans on short selling, and strict market regulations.
Panellists disagreed, with one stating: 鈥淭here has been phenomenal growth since the short selling ban was lifted in March last year, resulting in an increased requirement for funding.鈥� They added that the opportunities created by this are positive, allowing people to swipe their balance sheets with their funding capabilities.
They highlighted that lifting the ban has allowed firms to release new strategies in Korea. The panellist looks at the region as a 鈥渟uccess story鈥� despite its challenges and regulatory backdrop, highlighting that both institutional investor and retail participation is up. 鈥淭here is still more to come, so watch this space,鈥� he concluded.
鈥淪ecurities finance continues to evolve in terms of platforms, demand, and settlement cycles. The time to market and for the full lifecycle to complete is changing, and I would not say it is synchronised yet, it is still very fragmented,鈥� the moderator stated. They compared APAC鈥檚 markets to those more developed in Europe and the Americas, and asked: but what else is out there in terms of securities finance lending platforms?
There are multiple components within securities financing platforms, whether it be technology, operational efficiency and connectivity, or engagement. One perspective on the panel noted the increasing degree of sophistication in their client base. As the client base grows, the speaker noted that firms must consider client use cases in every one of those platforms, which need to be supported by a technology stack, and an investment tool that enables scale, flow, and resilience. They concluded that innovation as well as resiliency is integral to the market.
鈥淣o panel is complete without the mention of AI,鈥� a panellist continued. This technology has already started to prove it is the accelerator regarding how much of the innovation gets managed, they explained. The panellist stated they feel as though 2026 will continue to be a year of innovation: 鈥淢any years ago it was a securities lending conference, now it is a securities finance conference, and that reflects the innovation that we continue to see.鈥�
During the discussion, it was noted that Korea has extended its trading hours by different exchanges, and this is going to continue, meaning operational friction is now a competitive disadvantage requiring automation across the lifecycle to allow firms to predict utilisation, cost, balance sheet, and shortfall of inventory.
Discussing the move to shorter settlement cycles, a speaker stated this will drive the need for quicker cloud mobility and a more resilient and motivated front-to-back settlement and finance process, noting that is where investment technology is going to continue. 鈥淭+0 creates challenges, but it is good testing prep.鈥�
When talking about innovation in securities financing, panellists were asked what would be most beneficial to each of them. One person said they would like data-driven decision making to allow them to forecast market trends and understand flows, allowing them to anticipate needs and efficiently manage them, rather than reacting.
This led to panellists being asked if they view emerging technologies as embellishments to allow people to make better decisions, rather than replacing humans.
The consensus showed that allowing AI to make more 鈥渃hallenging鈥� decisions will be beneficial for everyone, and that by developing technology to take on the more onerous responsibilities, humans are able to spend more time thinking about client needs while not being 鈥渙verloaded with information鈥�, therefore making more informed decisions.
Shifting the conversation to the war in the Middle East, the panellists were asked about its impact on markets, and to what degree it has redefined market paradigms.
鈥淚t is very difficult to forecast,鈥� noted one panellist, who highlighted that over the last week there has been increased volatility because of the geopolitical climate, and it is something that will be watched very closely. Another speaker agreed that it is currently too soon to predict the outcome, however they do not feel as though it will change the immediate dynamic of funding requirements, but rather put a different spin on it.
One panellist drew a comparison between two types of markets, stating there is a subset of markets that are fundable through triparty and synthetics, or physical and synthetic forms. Within these markets the question is more about where the supply comes from, as opposed to how do you finance it, and how do banks and brokers source that funding requirement and that supply in a way that is optical for their constraints. They note there is another cross section of markets where it is more challenging to finance, where there are barriers to how you could typically have a traditional finance market driven by infrastructure, regulation, and tax such as Taiwan and Korea. They state it is those complexities and constraints that drive innovation in the market, noting Taiwan is a 鈥渇antastic鈥� example.
The panel concluded that no one market is the same, highlighting that issues are not consistent across markets. 鈥淚f you take China or India, there is no physical finance market that is permissible for foreign institutional investors,鈥� stated one speaker, who underscored that it is an infrastructure and legislative problem.
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