TASECH Risk Fund
The TASE Clearing House ("TASECH") serves as a Central Counter Party (CCP) for transactions that are executed on the TASE, for trading transactions that are carried out in the European MTS trading system, for transfers to a trustee for custody which are continuations of transactions executed on the TASE (custodian transactions), and for returns on lending transactions which were executed in the TASECH's lending platform.
Due to being a central counterparty, the TASECH undertakes to fulfill all the obligations of the failed TASECH member towards the other TASECH members in the event of a failure.
The TASECH has protections enshrined in the Securities Law and in the TASECH bylaws, as well as various measures to minimize and manage the risks inherent in the failure event, in order to enable the TASECH to fulfill its obligations as a central counterparty and to allow it to return to regular activity as soon as possible.
The Risk Fund is the main financial resource used by the TASECH to protect against a member's failure event. The members of the TASECH deposit collateral in the Risk Fund according to the degree of exposure they create for the TASECH in respect of their activity in trading on the TASE, their activity in the MTS system and in custodian transactions.
The assets that can be used as collateral are cash, government bonds and / or short term loans (Makam), the collaterals deposited by the member must include at least 25% of the assets in cash. The share of each member is calculated according to the bylaws.
The Risk Fund is updated four times a year and each member's part is updated accordingly.
Risk Fund Size Calculation
The size of the Risk Fund is determined according to the largest financial commitment that was in the first multilateral clearing window of a TASECH member or related TASECH members (banking group, leading member of clearing house) in the last 5.35 years and at a significance level of not less than 99%. To the amount received will be added additional costs expected for the TASECH when handling the inventory of a TASECH member who has failed and will be deducted from the TASECH's own funds.
Risk Fund Update Dates
The size of the Risk Fund is updated four times a year, 15 days after at the end of each quarter (January 15th, April 15th, July 15th, October 15th). .
As of 15.10.21, the size of the Risk Fund is 1,605,578,729 NIS.
Safety factors for Israeli government bonds/ short-term loans
The safety factor applied for an Israeli government bond / short-term loan (MAKAM) (hereinafter: "bond") is used to adjust the market value of the bond to its value for collateral purposes, taking into account relevant risks.
The safety factors are calculated by the Risk Management Department.
To the safety factors operated by TASECH >
More about TASECH