Turkey's Capital Markets Board (SPK) has initiated the liquidation of 131 investment funds with over $18 billion in assets, impacting approximately 350,000 investors. This decision follows a period of significant turmoil in the country's asset-management industry, triggered by three asset managers, including Tera Portfoy and Pusula Portfoy, failing to meet redemption requests on some of their funds. The inability to fulfill these requests led to a steep selloff in the Turkish equity market.
To manage the liquidation process, the SPK has appointed two of Turkey's largest banks: Turkiye Is Bankasi AS and state-run Ziraat Bankasi AS. These banks are tasked with converting the fund assets into cash and then distributing the proceeds to investors. The liquidation process is anticipated to be completed within three months, though extensions are possible.
The broader market impact has been significant, with the crisis prompting Turkish authorities to intervene to support markets. In connection with the turmoil, several finance executives have been detained, and others have been issued travel bans as part of an ongoing investigation. Notably, Muhammed Yariz, Chairman of Pusula Portfoy Yonetimi AS, has been arrested.
