Bank Hapoalim Securities

Bank Hapoalim Securities was the commonly used name for Hapoalim Securities USA, Inc., a former United States broker-dealer connected to Israel’s Bank Hapoalim Group. The firm operated from New York and supported securities-trading activity for the banking group’s customers before ceasing business in 2019 and later being liquidated in Bank Hapoalim’s records.^[1][citation needed]

Overview

Hapoalim Securities USA, Inc. was a U.S. securities subsidiary associated with Bank Hapoalim, one of Israel’s major banking groups. In English-language filings and regulatory materials it appears as “Hapoalim Securities USA, Inc.” or “Hapoalim Securities U.S.A. Inc.” The name “Bank Hapoalim Securities” is not usually the formal legal name, but it is a reasonable descriptive label for the securities arm because the firm was part of the Bank Hapoalim group and carried the Hapoalim brand.^[1][2]

The firm’s role should be understood in the context of Bank Hapoalim’s broader capital-markets business. Bank Hapoalim describes its Financial Markets Division as responsible for capital-market activity in Israel and abroad, including securities and tradable-derivatives brokerage, securities custody, currency and non-tradable derivative trading, services for financial-asset managers, and management of market risks in the banking book.[citation needed] Hapoalim Securities USA was one of the structures through which the group historically maintained access to U.S. securities-market infrastructure and served clients whose activity involved U.S. broker-dealer regulation.

FINRA’s BrokerCheck report identifies the firm as a corporation, formed in Delaware on September 23, 1993, with CRD number 266 and SEC number 8-3018. Its former main and mailing address was 1120 Avenue of the Americas, 19th Floor, New York, New York 10036.^[1] BrokerCheck also states that the firm is no longer registered with FINRA or a national securities exchange and that the date it ceased business was January 29, 2019.^[1] Bank Hapoalim’s 2025 annual report later recorded “Hapoalim Securities U.S.A. Inc.” under changes in the bank’s investments in subsidiaries and equity-basis investees, with the nature of the change listed as liquidation on December 17, 2025.[citation needed]

Position within the Bank Hapoalim group

The firm was part of a cross-border banking and securities structure centered on Bank Hapoalim in Israel. A 2014 public resolution-plan document filed in the United States described Bank Hapoalim B.M. as a publicly held banking corporation organized and operating under Israeli law and subject to comprehensive supervision by the Bank of Israel. The same document stated that, in the United States, Bank Hapoalim owned Hapoalim Securities USA through PCM-HSU Holdings, Inc., a Delaware-incorporated holding company, and described Hapoalim Securities USA as a Delaware-incorporated SEC-registered broker-dealer.^[2]

The ownership chain changed in later records or was reported differently for broker-dealer purposes. FINRA’s BrokerCheck report lists BHI USA Holdings, Inc. as a direct owner with a 75% or more ownership percentage beginning in September 2012.^[1] It also lists several indirect ownership entries connected with Poalim capital-markets entities, including PoliAM Capital Markets and Investments - Holdings Ltd. and PoliAM Capital Markets Ltd.^[1] These entries indicate that the broker-dealer was not a stand-alone retail brokerage unrelated to the bank; rather, it was part of a banking group’s international and capital-markets structure.

Bank Hapoalim’s current group description emphasizes that the bank operates in Israel in all areas of banking and in activities related to banking, serving customers through retail, corporate, and financial-markets divisions.[citation needed] The bank’s Financial Markets Division covers securities and derivatives activity, while the Corporate Banking Division is responsible for the group’s international activity, primarily corporate credit for customers in the United States through the New York branch.[citation needed] Hapoalim Securities USA belonged to the group’s historical overseas securities presence rather than being an Israeli domestic bank branch.

Broker-dealer registration and activities

In the United States, a broker-dealer is regulated as a securities intermediary. Hapoalim Securities USA was a registered broker-dealer under Section 15(b) of the Securities Exchange Act of 1934, according to a 2014 order of the U.S. Securities and Exchange Commission.^[3] The same SEC order described it as a municipal securities dealer and municipal securities broker.^[3]

FINRA’s BrokerCheck report states that the firm’s registration was from December 9, 1939 to April 1, 2019 and that the firm is no longer registered.^[1] This date range appears in the regulatory-registration section of the BrokerCheck report and may reflect the registration record associated with the firm’s CRD file rather than its Delaware incorporation date; BrokerCheck separately states that Hapoalim Securities USA was formed in Delaware on September 23, 1993.^[1] The report also identifies its business as involving a networking, kiosk, or similar arrangement with a bank, savings bank or association, or credit union.^[1]

The firm did not hold or maintain customer funds or securities and did not provide clearing services for other broker-dealers, according to BrokerCheck.^[1] Instead, the report states that it referred or introduced customers to other brokers and dealers. Its disclosed clearing arrangement was with Pershing LLC, effective February 2, 2004, under which Pershing cleared certain business of the applicant and its customers on a fully disclosed basis.^[1] This is consistent with the common introducing-broker model, in which a broker-dealer maintains client relationships or order-routing functions while another broker-dealer performs clearing, custody, and settlement functions.

An older Bank Hapoalim disclosure filed with the SEC described Hapoalim Securities U.S.A. Inc. as a broker-dealer registered and operating in the United States, supervised by the SEC, the New York Stock Exchange, the National Association of Securities Dealers, and other exchanges in which it was a member. The same disclosure said the company supported the expansion of the bank’s securities-trading activity for customers and that Bank Hapoalim held 100% of its share capital.^[4]

Relationship to Israeli banking and capital markets

Although Hapoalim Securities USA was incorporated and regulated in the United States, its economic relevance lies in its connection to an Israeli banking group. Bank Hapoalim’s capital-markets activities include securities trading, custody, foreign-currency and derivatives trading, research, services for asset managers, investment portfolio management, investment banking, underwriting, and issuance management.^[5] These activities place the group among the main Israeli banking participants in securities services, alongside other large banks such as Bank Leumi, Israel Discount Bank, Mizrahi-Tefahot Bank, and First International Bank of Israel.

For Israeli customers, access to foreign securities markets has often been provided through the bank’s domestic brokerage and custody systems, supported by international custodians, correspondent banks, or group affiliates. Bank Hapoalim’s 2025 annual report states that its Financial Markets Division is responsible for capital-market activity inside and outside Israel, including brokerage in securities and tradable derivatives, securities custody, and services for financial-asset managers.[citation needed] The report also notes that Bank Hapoalim provides sub-custody services for leading foreign custodian banks active in Israel in the area of securities.[citation needed]

The Israeli regulatory perimeter differs from the U.S. broker-dealer perimeter. In Israel, banks are supervised by the Banking Supervision Department of the Bank of Israel, while securities markets, public offerings, fund regulation, and many investment-service issues involve the Israel Securities Authority. Trading infrastructure for listed Israeli securities is centered on the Tel Aviv Stock Exchange. Hapoalim Securities USA, by contrast, was a U.S.-registered broker-dealer and therefore subject to U.S. broker-dealer rules while also forming part of an Israeli supervised banking group.^[2][3]

Regulatory history

The most prominent published regulatory matter involving Hapoalim Securities USA was a 2014 SEC administrative and cease-and-desist order concerning Puerto Rico municipal bonds. The SEC order stated that the proceedings involved the sale of non-investment-grade bonds issued by the Commonwealth of Puerto Rico by Hapoalim, a registered broker-dealer and municipal securities dealer, to customers in amounts below the minimum denomination of the issue.^[3]

According to the SEC, MSRB Rule G-15(f) prohibits dealers from effecting customer transactions in municipal securities in amounts below the minimum denominations of the issues, subject to limited exceptions.^[3] The order found that, in March 2014, Hapoalim violated MSRB Rule G-15(f) by executing one sale of Puerto Rico bonds to a customer in an amount below the issue’s $100,000 minimum denomination.^[3] The order also described the 2014 Puerto Rico general-obligation bonds as non-investment-grade securities and recorded the issue’s ratings at that time as Ba2 by Moody’s, BB+ by Standard & Poor’s, and BB by Fitch.^[3]

This matter illustrates the type of rule set applicable to a U.S. municipal securities dealer. Broker-dealers dealing in U.S. municipal securities are subject not only to SEC oversight but also to rules of the Municipal Securities Rulemaking Board. In the Hapoalim order, the issue was not a broad finding about all customer suitability or a failure of the Israeli banking group as a whole; it was a specific finding concerning a single sale below a stated minimum denomination under a municipal-securities rule.^[3]

FINRA’s BrokerCheck report is also a key public record for the firm. It provides a standardized regulatory profile, including registration status, ownership, executive officers, business types, clearing arrangements, and disclosure events. As of the report opened for this entry, BrokerCheck states that the firm no longer has active registration with FINRA or a national securities exchange and that it did not owe money or securities to any customer or brokerage firm at the time of its withdrawal information.^[1]

Cessation of business and liquidation

The firm’s public regulatory profile indicates that its active U.S. broker-dealer role ended in 2019. BrokerCheck gives January 29, 2019 as the date the firm ceased business and April 1, 2019 as the end date of the firm’s registration.^[1] These dates mark the practical end of Hapoalim Securities USA as an active U.S. broker-dealer.

The legal cleanup of the subsidiary appears later in Bank Hapoalim’s financial reporting. In its Annual Report 2025, Bank Hapoalim listed “Hapoalim Securities U.S.A. Inc.” under changes in investments in subsidiaries and equity-basis investees during the reported period, with a change date of December 17, 2025 and the nature of change described as liquidation.[citation needed] This means that, by the 2025 report, the entity was being removed or wound down in the bank’s corporate structure after the earlier cessation of regulated broker-dealer activity.

The distinction between ceasing business and liquidation is important. A broker-dealer may cease registered operations and withdraw from FINRA or exchange registration before the corporate entity is formally dissolved or liquidated. In Hapoalim Securities USA’s case, public records show the business ceased in January 2019, the broker-dealer registration ended in April 2019, and Bank Hapoalim reported liquidation of the entity in December 2025.^[1][citation needed]

Significance

Bank Hapoalim Securities is significant mainly as an example of how a large Israeli bank historically used a U.S. broker-dealer subsidiary to connect its capital-markets business with U.S. securities markets. Its activities were not comparable in scale or visibility to the parent bank’s domestic Israeli banking business, but they were part of the infrastructure supporting international securities services, brokerage access, and client trading needs.

The entity also demonstrates the layered regulation that applies to bank-affiliated securities businesses. Bank Hapoalim itself is an Israeli banking corporation supervised in Israel, while Hapoalim Securities USA was a Delaware corporation subject to U.S. broker-dealer and municipal-securities rules.^[2][3] The group’s capital-markets business also intersects with Israeli market institutions and regulators, including the Bank of Israel, the Israel Securities Authority, and the Tel Aviv Stock Exchange.

Because the firm is no longer active as a registered U.S. broker-dealer, current customers seeking securities services from Bank Hapoalim would look to the bank’s present capital-markets and custody arrangements rather than to Hapoalim Securities USA. The historical entity remains relevant for understanding the development of Bank Hapoalim’s international securities operations, the group’s former U.S. regulated-brokerage footprint, and the way Israeli banks organized cross-border market access in the period before the firm’s 2019 withdrawal and 2025 liquidation.