Bull Trade: How Much of the Collateral Is Actually Realizable
The headline number of nearly NIS 98 million of collateral looks, at first glance, like a broad protection layer. But by the end of 2025 only NIS 61.5 million of the book sat in the real-estate-and-tangible-collateral lane, while NIS 58.7 million inside the deferred-check book had no real-estate or tangible collateral at all. Even the secured lane is now almost entirely Stage 3, so the key question is not how much collateral is listed in the note, but how much of it can actually turn into cash.
How Much of the Collateral Actually Matters for Recovery
The main article argued that Bull Trade's collateral should not be read as cash. This follow-up isolates only that layer: how much of the book is really sitting behind collateral that deserves serious recovery discussion, and how much of that stated value could realistically survive the path through restructurings, legal process, and realization.
The answer is sharper than the headline number suggests. At the end of 2025 gross customer receivables stood at NIS 130.375 million. Of that, only NIS 61.484 million sat in the lane of loans backed by real estate and tangible collateral, while NIS 68.891 million sat in deferred check discounting. In other words, almost 53% of the book still sits in the layer that benefits much less from collateral.
The headline collateral figure, NIS 97.961 million, can create the impression that most of the portfolio is wrapped in a wide protection layer. That is the wrong read. NIS 91.461 million of that figure belongs to the real-estate-backed lane, and only NIS 6.5 million belongs to the deferred-check lane. So the note does not say that the whole book has almost NIS 98 million of collateral. It says that almost all of the collateral sits in one half of the book, while the other half relies largely on recovery without real estate and without tangible hard assets.
The carrying value after provisions makes that even clearer. In the real-estate-backed lane only NIS 22.006 million of net value remained after a NIS 39.478 million allowance. In deferred checks only NIS 9.127 million remained after a NIS 59.764 million allowance. So even before asking what will happen on realization day, the financial statements themselves have already taken down most of the nominal value through provisions.
| Layer in the book | Gross balance, NIS millions | Stated collateral value, NIS millions | Credit-loss allowance, NIS millions | Net value, NIS millions | What it really means |
|---|---|---|---|---|---|
| Real-estate-secured loans and tangible collateral | 61.484 | 91.461 | 39.478 | 22.006 | There is paper collateral, but almost all of the exposure already sits in an impaired book |
| Deferred check discounting | 68.891 | 6.5 | 59.764 | 9.127 | Most of this book has almost no real-estate or tangible collateral |
That chart is the core of the continuation. If one looks only at the collateral column, the picture can still feel somewhat comfortable. Once the structure of the book and the allowance layer are added, the read changes completely. The secured lane is already deeply damaged, and the unsecured lane is almost fully written down economically.
Even the Secured Layer Is Already Deep in Stage 3
The second mistake is to assume that "secured" means "healthy." The report says the opposite. As of December 31, 2025 there were no Stage 1 exposures left at all. In 2024 there were still NIS 3.206 million in Stage 1. In 2025 that layer disappeared. The whole book is now already in Stage 2 or Stage 3.
This is not just a technical classification issue. The company explicitly says it is no longer extending new credit and is only collecting existing debts, while customer receivables are in Stage 2 and Stage 3 and the specific allowance is updated according to each customer's condition and the legal process around it. In plain language, the collateral here does not sit behind a going, performing loan book. It sits above files that have already moved into collections, reschedulings, and legal handling.
At the total-book level, NIS 124.033 million, about 95.1%, is already in Stage 3. Another NIS 6.342 million, about 4.9%, is in Stage 2. Inside the real-estate-backed lane the picture is even sharper: NIS 60.187 million out of NIS 61.484 million, about 97.9%, is already in Stage 3. So almost the entire secured lane is no longer "credit with collateral." It is "impaired debt with collateral."
The practical meaning is that the collateral is no longer sitting above borrowers who are paying on schedule. It sits above files that already require legal and recovery work. That matters because the company also warns, explicitly, that collateral values are shown without quick-sale haircuts, without taxes, levies, and expenses, and may include floating liens that are not specific to the debt or surplus from liens that cannot be transferred to other loans. So the value shown in the note is a starting point for analysis, not an estimate of net cash recovery.
The direction from 2024 to 2025 is not comforting either. In the real-estate-backed lane collateral value fell from NIS 149.979 million to NIS 91.461 million, down about 39.0%, while the gross balance in that same lane fell from NIS 94.011 million to NIS 61.484 million, down about 34.6%. In the other half of the book, deferred checks, collateral fell much more sharply, from NIS 15.5 million to NIS 6.5 million, down about 58.1%, while the book itself fell only from NIS 78.004 million to NIS 68.891 million, down about 11.7%. In other words, the collateral layer is not merely shrinking with runoff. It is being revised downward faster than the debt itself.
The Deferred-Check Book Is Mostly Credit Without a Collateral Layer
This is where the headline collateral read really breaks down. The deferred-check portfolio stood at NIS 68.891 million at the end of 2025. But within that book the company explicitly separates two sub-books: debt backed by real estate and tangible collateral of NIS 10.166 million, and debt not backed by real estate and tangible collateral of NIS 58.725 million.
That split is critical. It means about 85.2% of the deferred-check book no longer benefits from real-estate or tangible collateral at all. Even the remaining 14.8% is not fully covered. Against NIS 10.166 million of backed debt, the company shows only NIS 6.5 million of collateral and still discloses exposure to debt of NIS 3.666 million within that backed slice.
The allowance confirms that accounting view. The allowance on the deferred-check book stood at NIS 59.764 million, or about 86.8% of the book. In Stage 3 the weighted allowance rate disclosed by the company for this lane is about 92.63%, and in Stage 2 about 12.37%. That is a strong indication that the recovery embedded in the book does not rely on the breadth of the check portfolio. It relies on a relatively small number of files where there is still something meaningful to capture.
The table of the ten customers with the largest outstanding balances says the same thing from another angle. Four out of the ten largest exposures as of December 31, 2025 are presented without any disclosed collateral value at all. So even inside the company's largest risk pockets there is no uniform, continuous collateral layer. Some files have collateral, some do not, and even where collateral exists it still says little by itself about what will remain after the road to realization.
Concentration Did Not Go Away, It Became Sharper
Even if one assumes that some collateral is indeed realizable, the next question is where it sits. Here too the report shows a more concentrated picture, not a less concentrated one. The ten customers with the largest debt balances held 49.20% of the book at the end of 2025, up from 45.45% at the end of 2024. So almost half of the company's recovery story already sits in only ten files.
The largest single borrower sharpens that point further. The company presents one single borrower in real estate at 19.46% of the book, up from 14.70% a year earlier. The stated collateral value for that borrower fell from NIS 14 million to NIS 10 million, and in the same footnote the company says this borrower consists of several different legal entities and that a specific allowance was recorded against it. That is a small note with a large implication. Even when there is a file that looks "secured," it is not necessarily a simple file.
The gap between credit concentration and income concentration reinforces the same read. In 2025 the three largest customers generated only 10.91% of finance income, down from 34.47% in 2024. On a superficial read that can look like healthier diversification. In practice it mainly reflects the fact that a larger part of the book has stopped generating ordinary current finance income and moved into troubled-debt treatment. Concentration did not disappear. It shifted from income concentration to recovery concentration.
What This Means for Recovery
The conclusion from this note is simpler than the tables themselves. Bull Trade's collateral is a screening layer, not a cash cushion. It applies only to part of the book, it has deteriorated materially versus last year, it sits almost entirely above Stage 3 exposures, and it is concentrated in a relatively small number of large files.
That is why the right read of year-end 2025 is not "almost NIS 98 million of collateral against a NIS 130.4 million book." The right read is different: NIS 61.5 million of the book sits in the secured lane, but even there almost the entire exposure is already impaired; NIS 68.9 million sits in deferred checks, and NIS 58.7 million of that has no real-estate or tangible collateral at all; and in both lanes the value shown in the report is still very far from free cash.
That also defines the key monitoring point going forward. The question is not whether Bull Trade has collateral on paper. It does. The question is whether, in the relatively few files where a real collateral layer exists, realization will be fast and strong enough to outrun the continued erosion in collateral values, expenses, and legal complexity. Until that answer becomes visible in cash, collateral remains a possible indicator of recovery, not proof of a high recovery rate.
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