The Australian margin lending industry contracted slightly in 2016, following another year of volatility in equity markets. Both the number of active margin lending accounts and margin debt outstanding fell by five per cent in the 12 months to 30 June 2016 (to 63,738 and $11.8 billion, respectively), according to the Reserve Bank of Australia.In addition, a study by Investment Trends (a research firm in the retail online share trading markets) showed the average investor was expecting the share market to deliver capital gains of just 2.6 per cent in the next 12 months, down from four per cent in 2015 and six per cent in 2014."The margin lending industry continues to face headwinds from turbulent share market conditions, and the resulting bearish sentiment among investors" said Recep Peker, research director at Investment Trends. "Despite this adversity, it is noteworthy that the number of margin lending investors fell at the slowest annual rate since the GFC." His take on the current trend is that margin lending investors have become more savvy risk managers, and have a stronger intention to borrow more through margin loans.Switching intentions among current margin lending investors have been low and falling for many years. However, there was a reversal in this trend in 2016, with more margin lending clients looking for a new lender than in 2015. In an environment where client satisfaction is becoming increasingly critical, CBA's CommSec joins Bendigo and Adelaide Bank's margin lending business, Leveraged, to become the industry's highest rated margin lenders. CommSec also boasts the highest conversion rates of the industry.