Two government reports slated to be released today will offer guidance for sponsors and participants on securities lending in 401(k) plans, the Wall Street Journal reports
The Senate Special Committee on Aging and the Government Accountability Office conducted separate investigations into securities lending and how the practice affects plan sponsors and participants. Specifically, the Senate Aging Committee surveyed the 30 largest 401(k) plans, asking them to provide data about their plans from 2006 through 2010 and according to its report, more than one-third of sponsors said they had been restricted at the plan level from withdrawing from at least one investment option that participated in securities lending.
The Senate Aging Committee will reportedly recommend that sponsors provide plan participants with clearer disclosures about securities lending in their plan options. It also will ask the Labor Department to develop tools and guidance for sponsors on securities lending, and recommend that companies engaged in securities lending report information on their practices to the Securities and Exchange Commission and bank regulators.
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