Follow-up to TASE: the infrastructure cost of a more active market
TASE's strong first quarter is not only an operating-leverage story. The formal filing shows that higher market activity also comes with a larger clearing-resource stack, billions of shekels of collateral and derivative clearing positions that accounting netting does not remove operationally.
The main article on TASE framed the first quarter as a sharp operating-leverage quarter, but the formal filing adds a less comfortable layer: a more active market does not only lift revenue, it also expands the resource system that has to sit around clearing activity. This is not an immediate liquidity problem. The group and the clearing houses still show capital and liquidity surpluses above their requirements. Still, it changes the quality of the quarter: part of the operating upside arrives with an infrastructure, regulatory and operational cost that has to be followed separately from the top line. Open derivative positions stood at NIS 659.7 million after offsetting gross amounts of NIS 1.54 billion, with billions of shekels of collateral and financial resources around the clearing system. The next proof point is therefore not only whether trading volumes remain high, but whether the company can carry clearing volume, infrastructure investment and shareholder distributions without narrowing the safety margin.
The Operational Load Rises With Revenue
The familiar Q1 numbers explain why the market received a strong story: revenue reached NIS 183.3 million, up about 40% year over year, and trading and clearing fees rose to NIS 71.1 million. Revenue from clearing services to members jumped to NIS 53.9 million, up about 69%. That is the attractive side of a more active market: more trading volume, more assets under custody and more activity flowing through infrastructure that already carries a large fixed-cost base.
But the clearing houses are not only a fee engine. They are also central counterparties, so the activity around them requires capital, liquidity, collateral, risk funds and internal models. The capital and liquidity requirements cover not only clearing-house credit exposure, but also market risks in the investment portfolio, operational and legal risks, business continuity and reorganization, and a minimum contribution by each clearing house to the collateral waterfall if a clearing member defaults.
The important point is not that the company has suddenly become risky. It is that the strong quarter relies on infrastructure whose requirements are active and moving. On November 11, 2025, the company board and the clearing-house boards approved an updated capital and liquidity methodology following external validation. In other words, the regulatory and operating environment already treats the clearing houses as a system that has to be recalibrated, not as a passive revenue line.
The Clearing Stack Is Already Measured In Billions
The infrastructure cost shows up most clearly in the resources available to handle a clearing-member default. This does not sit in the income statement, but it determines how much resource has to surround the activity when the market is running at high intensity.
| Clearing-resource layer | 31.03.2026 | Why it matters |
|---|---|---|
| Current margin required to be deposited | about NIS 3.87 billion | The first protection layer against daily moves and member default |
| Risk-fund collateral | about NIS 627 million at the MAOF clearing house and about NIS 34 million at the TASE clearing house | High activity also requires resources supplied by clearing members |
| Total financial resources for handling a member default | about NIS 6.46 billion | Clearing is an infrastructure business supported by a resource base far larger than quarterly revenue |
The period comparison adds the relevant context: total financial resources stood at about NIS 5.42 billion at the end of March 2025 and about NIS 7.88 billion at the end of December 2025. This is not a stable number that can be ignored after a strong quarter. It moves with exposures, market activity and collateral requirements. That does not cancel the company's operating advantage, but it prevents too-flat a reading of high profitability as a completely light business.
Netting Reduces The Balance, Not The Work
The sharpest evidence sits in the open derivative positions. Assets and liabilities each show an identical NIS 659.7 million balance as of March 31, 2026, versus NIS 642.0 million a year earlier and NIS 775.3 million at the end of 2025. At first, that symmetry can look clean. In practice, the accounting symmetry is not a substitute for daily management of collateral, members, offsets and expiry dates.
The more important number is gross exposure: against the NIS 659.7 million net balance, gross amounts stood at NIS 1.54 billion, with NIS 880.7 million offset. Offsetting is allowed only when there is an enforceable legal right and an intention to settle the asset and liability on a net basis or simultaneously. Even then, the amounts do not include offsets arising from positions of the same member with different expiry dates. The balance sheet line is therefore the result of a netting mechanism, not a full description of the clearing workload.
The split by counterparty also shows why clearing is more than a technical issue. On the asset side, two anonymized members carried net balances of about NIS 201.8 million and NIS 358.5 million, compared with about NIS 99.4 million for the remaining members. That does not point to a problem at any specific member, and the company does not disclose identities. It does show why the clearing houses should be read as concentrated infrastructure that manages member risk, not only as a fee source that benefits from a strong market.
A Wide Cushion, But A Recurring Test
The reassuring side is that the clearing houses are not close to a disclosed shortfall. The TASE clearing house showed a capital surplus of about NIS 64.2 million and a liquidity surplus of about NIS 99.7 million above requirement. The MAOF clearing house showed a capital surplus of about NIS 36.4 million and a liquidity surplus of about NIS 49.6 million. In the same quarter, the company invested NIS 24.7 million in technology infrastructure and paid a NIS 144.8 million dividend, so strong cash flow has to support infrastructure, the clearing stack and distributions at the same time.
The current judgment is clear: a more active market is still good for the company, but it does not arrive without an infrastructure cost. As long as the clearing houses maintain wide capital and liquidity surpluses and technology spending does not begin to consume the fee advantage, Q1's operating leverage remains real. The counter-thesis is that much of the clearing-resource base comes from member collateral and member-funded risk funds, so the burden is not fully or directly borne by shareholders. The next proof point over the coming quarters is whether default resources, derivative balances and infrastructure investment remain under control if trading volumes stay high or become more volatile.
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