SECURITY DELIVERIES, LOANS, AND TRANSFERS 373
Notifying the Stock Clearing Corporation.—The bor-
rower’s representative next takes the two forms of the new
loan agreement, which have by this time been signed by both
borrower and lender, to the Stock Clearing Corporation. He
delivers them at the particular cage there where the account of
the borrower as a clearing member is kept, and the clerk in the
cage files them for future reference. Thus, the Stock Clear-
ing Corporation is officially notified that it must be prepared
to act as agent for borrower and lender in handling the loan
about to be made. Under certain circumstances, however, the
Stock Clearing Corporation reserves the right to refuse to act.
in which case the loan must be made “ex.”
Representatives of lending institutions usually pay three
calls a day at the Stock Clearing Corporation; at 10:00 A.M.
and 12:30 P.M. for paid-off loans and at 2 :30 for new loans.
With new loans, they bring forms of the new loan agreement
previously detached and retained at the lender’s office, as well
as the check of the lending institution made out payable to the
Stock Clearing Corporation for the account of the borrower,
for the principal of the new loan to be made. It may be that
all the securities to be used as collateral for the new loan have
already been deposited with the Stock Clearing Corporation as
the result of a previous loan which the Corporation already
has paid off in behalf of the borrower.
Making the New Loan.—In consequence of the lender
having shown that he has approved the collateral pledged for
the loan by signing the new loan agreement, the lender’s rep-
resentative has only to see that the securities he obtains are
identical with those stated upon the new loan agreement form
which he has, and that the certificates are in such negotiable
shape as to conform with his requirements. About 2 :30 P.M.,
therefore, the lender’s representative obtains the security col-
lateral for the new loan from the cage where the borrowing
clearing member’s account is kept, and at the same time de-
livers to the clerk in that cage the check of the lending insti-
