Statement on the Fund Market from Minister Şimşek: No Widespread Risk
Treasury and Finance Minister Mehmet Şimşek reported that following issues in a limited number of funds, there is no systemic risk and the problematic area has been quarantined.
Treasury and Finance Minister Mehmet Şimşek made evaluations regarding the liquidity and credit issues experienced in a limited number of funds in the markets. Emphasizing that there is no systemic risk, Şimşek announced that the problematic area has been quarantined and necessary measures have been rapidly implemented.
Issues Experienced in a Limited Number of Funds
Stating that the market volatility occurred in a limited number of funds, Treasury and Finance Minister Mehmet Şimşek expressed that there is no widespread systemic risk.
Conveying that this situation is seen in only 131 out of 2,038 funds across Turkey, Şimşek stated that there is no structural problem in the stock market and fund market.
Problematic Area Quarantined
Stating that free funds are an area involving qualified investors and subject to looser regulations similar to hedge funds in the world, Minister Şimşek said that regulations in this area have been largely completed.
Stating that the Capital Markets Board rapidly quarantined the problematic area and then announced the liquidation process, Şimşek noted that the probability of a similar volatility occurring is very low.
Measures Taken by Economic Authorities
Reminding that the Financial Stability Committee convened, Şimşek stated that the Central Bank announced it would provide the necessary liquidity and that the BRSA took a reassuring step regarding banks buying their own shares.
Emphasizing that B and C plans are ready for all kinds of scenarios, Şimşek stated that thanks to the right measures taken, the stress in the bond market has completely disappeared and interest rates have fallen.
State of the Banking System and Markets
Stating that the banking system is subject to strict rules and that there are no problems in liquidity and asset quality, Şimşek emphasized that confidence in the market continues.
He added that while CDS premiums could rise in the case of a high risk perception, on the contrary, a decline, even if limited, has occurred, and the stock market and general market sentiment are progressing positively.