Regulations Governing Securities Finance Enterprises Article 23

A securities finance enterprise providing re-financing to a securities firm for margin purchases shall not provide a margin ratio higher than the margin ratio that the securities firm provides to its customer, and shall collect as collateral all securities purchased with the margin purchase financing.A securities finance enterprise providing re-financing to a securities firm for short sales shall collect a short sale margin whose ratio shall not be lower than the short sale margin ratio that the securities firm provides to its customer, and shall take the proceeds of the short sales as collateral.A securities finance enterprise providing re-financing to a securities firm for securities lending shall collect securities lending collateral for the securities it loans to the securities firm at a collateralization rate that may not be lower than the collateralization rate that the securities firm provides in securities lending to customers.The short sale margin that shall be collected by securities finance enterprises under paragraph 2 may be paid in securities; the types of securities and standards for such payment shall be prescribed by the securities finance enterprise and reported to the competent authority for its approval.