EquiLend Experiencing Service Disruption Due To Hacking, Service Begins To Recover

EquiLend's financial technology company announced on Friday, February 2 that some services, including trade and post-trade solutions, had been restored, more than a week after experiencing disruptions due to unauthorized access to its system.

EquiLend, a company that plays an important role in lending securities on Wall Street, revealed in late January that it had identified unauthorized access to its system and part of the system had to be deactivated.

The company's securities loan platform, Next Generation Trading, manages more than $2.4 trillion annually, according to its official website. Their client base includes nearly 200 asset owners, agent lending banks, brokers and hedge funds.

EquiLend is partly owned by several Wall Street giants, including Goldman Sachs, BlackRock, JP Morgan, and Bank of America Merrill Lynch.

The latest hacker attack on EquiLend forced market participants to carry out the process manually with limited impacts, a spokesman from the Financial Services Information Sharing and Analysis Center (FS-ISAC) told Reuters last week.

"Cliens are also at risk of not fulfilling important regulatory reporting obligations," said Josh Galper, major manager of capital market consultant Finadium.

"If data is not available from EquiLend, risk managers and liquidity managers may not know what they have, which affects their risk ratio and capital ratio, as well as affects their ability to manage internally and report to regulators," Galper said.

However, with the service starting to be restored, he said "data will be well-ordered over time. Reports will be submitted. Maybe it will be too late.