Where Are Your Shares Held During a Stock Loan?

With Black Haven, pledged shares are held in an account in the borrower’s or pledgor’s name at an independent custodian in The Bahamas, regulated by the Securities Commission of The Bahamas. The account is opened after the loan agreement is signed, and the shares are delivered into it after the funding notice, as the last step before the loan is funded.

The custodian holds the shares through a sub-custodian: a custodian in the home market that holds them in the local central securities depository on its behalf, such as CCASS in Hong Kong, KSEI in Indonesia or CDP in Singapore. Between the issuer and you there are therefore three layers: the central depository, the sub-custodian’s account in it, and the custody account in your or the pledgor’s name.

The borrower and the pledgor can be different parties, for example where the shares are owned by a holding company such as a BVI vehicle, and several pledgors can secure one loan. Every borrower and pledgor completes KYC, including beneficial owners. The lender’s control over the custody account takes effect only at the same time as the loan is paid out, a sequence explained in do you hand over your shares before you are paid.

The sub-custodian is the custodian’s local link. It holds the pledged shares in the home market’s central depository on the custodian’s behalf: in CCASS for Hong Kong shares, in KSEI for Indonesian shares, in CDP for Singapore shares. It is not named in the loan agreement. It appears in the custodian’s settlement instructions (SSIs), which the borrower receives after signing and which tell the borrower’s broker or current custodian where to deliver the shares.

Delivery is the sixth of the seven closing steps. Once the term sheet is countersigned, KYC is complete, the loan agreement is signed, the custody account is opened and the funding notice is given, the borrower’s broker delivers the shares to the sub-custodian’s account in the depository for credit to the custody account, and the loan is then funded. Where the shares are already in the depository, the move is a transfer between accounts inside it rather than a physical delivery; HKEX, for example, describes shares in CCASS as freely transferable within the system once re-registered.

Each market has its own central securities depository, and the sub-custodian holds the pledged shares in the one for the issuer’s home market. The table lists the depositories for the main markets Black Haven covers, drawn from the depositories’ and their groups’ own published material; market-specific points are on the country pages, such as Hong Kong stock loans.

Two recent changes are easy to miss. Germany’s depository, formerly Clearstream Banking AG, has been named Clearstream Europe AG since 26 September 2025. On Euronext, from 21 September 2026 trades on Euronext Amsterdam, Brussels and Paris can settle in Euronext Securities, whose first phase consolidates settlement in Euronext Securities Milan, while the Euroclear depositories remain available as alternatives and the choice of issuer CSD stays with the issuer.

On repayment the lender releases its security and the shares return to the borrower’s unencumbered control. Until then they stay in the custody account in the borrower’s or pledgor’s name for the life of the facility. Black Haven’s facilities run for 12 to 60 months, and early repayment is permitted after a lock-out period agreed for each facility, typically 12 to 36 months; how dividends and corporate actions on the pledged shares are treated is set out in the loan agreement.

The structure is the same in every market; what changes is the depository at the bottom of the chain. For how custody fits into a facility as a whole, see stock loans. This guide is general information about how Black Haven’s facilities are structured, not legal advice: the loan agreement governs any particular facility, and the depository details in the table are as at 27 October 2026.