Financial Stability Committee Convenes and Takes Steps for Markets
Following the meetings of the Financial Stability Committee, which gathered after distress in the fund market, the Central Bank and the BRSA took steps targeting the system.
Following the distress experienced in the fund market, the Financial Stability Committee convened under the chairmanship of Treasury and Finance Minister Mehmet Şimşek, after which the Central Bank and the BRSA took successive steps.
Committee Meeting Held
In a written statement issued after the meeting where developments in financial markets were evaluated, it was stated that recent developments in capital markets were discussed.
It Was Stated That the Problem Is Temporary
The statement expressed that the volatility in the markets stemmed from credit and liquidity problems experienced in certain funds under the custody of a limited number of portfolio management companies.
It was emphasized that there is no fundamental or structural risk regarding the functioning of Borsa İstanbul and the capital markets, and that the issue is of a temporary and manageable nature.
Liquidity Steps from the Central Bank
Taking liquidity conditions into account, the Central Bank announced that it will increase the amount of funding to be provided through weekly repo auctions.
Additionally, it reported that borrowing limits in the Interbank Money Market will be updated and collateral discount rates will be reduced.
Flexibility Provided by the BRSA
The BRSA announced that convenience has been provided to banks in their own share buyback transactions and granted flexibility in the calculation of the capital adequacy ratio.