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What is a Dividend in Lieu?

With securities lending, the borrower will receive the dividend on the security they are borrowing from the lender.

The borrower then pays the lender the same amount of money. This is “Payments In Lieu of Dividends”, or “Dividends in Lieu”.

The amount of money being received by the lender is the same, but may be taxed differently than a regular dividend. If you have more questions about the tax implications, we recommend you contact a tax advisor.

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