Cabinet approves turning stock exchange into a for-profit

Cabinet ministers on Sunday unanimously approved a bill proposed by Finance Minister Moshe Kahlon (Kulanu) to change the Tel Aviv Stock Exchange (TASE) into a for-profit venture.

According to Kahlon, ending the banks' control over the exchange would allow the TASE would be more dynamic, competitive and able to attract more listed companies and boost trading.

Having ownership separate from its members would make it like an ordinary company, in contrast to the existing model of a non-profit entity in which the brokers are the controlling shareholders.

“This is an undertaking that will bring economic growth, strengthen the Bursa (stock exchange) and restore it to its rightful place as a key engine of growth for the Israeli economy,” said Kahlon in a statement.

The TASE has been struggling with falling trading volumes and a declining number of listed companied in recent years. According to reports, thus far in 2016 the trading volumes averaged at 1.28 billion shekels ($332.5 million) a day, down from 1.45 billion a day in 2015 and less than 2 billion in 2010. The number of listed companies has dropped to 445 – 200 less over the past decade.

The plan also calls for moving the trading week from Sunday-Thursday to Monday-Friday, to better align the Bursa with overseas exchanges and allow traders to react more quickly to events.

Now that that Cabinet has approved the bill, it will be brought to the Knesset for a parliamentary approval.

Source: http://www.israelnationalnews.com/News/News.aspx/214433

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