Türkiye moves to speed fund repayments

ANKARA

(AA Photo)

Türkiye aims to complete the liquidation of 49 more investment funds by the weekend, after 43,643 investors received 6.4 billion Turkish Liras in payments last week.

The Communications Directorate announced the target following an Oct. 13 Fund Board meeting chaired by Vice President Cevdet Yılmaz.

The payments, made through Ziraat Bank, went to investors in funds managed by A1, Bulls and Pardus. The remaining liquidation involves 34.1 billion liras in assets.

Completion would bring total cash payments and asset transfers across the three companies’ 66 funds to 40.5 billion liras, covering 45,745 investors.

The board also aims to complete interim payments for another 65 funds swiftly once legislation governing the process is enacted, the directorate said.

The nine-article bill, submitted on Oct. 9, was on the agenda of parliament’s Plan and Budget Committee on Oct. 14.

The wider liquidation process covers 131 funds run by seven portfolio management companies and more than 455,000 investors.

If enacted, the bill would allow interim payments of up to 1 million liras per eligible investor, based on their remaining net investment.

These would be deducted from the final amount payable.

Where available cash is insufficient, the Capital Markets Board (SPK) could prioritize investors with the smallest net investments or set a minimum interim payment for all eligible investors.

Repayments would come from fund assets and money recovered from those responsible for losses, with no public funding planned.

The bill would expand the Savings Deposit Insurance Fund’s (TMSF) role in asset recovery, allowing it to sell property placed under its trusteeship before trials conclude.

Separately, Central Bank Governor Fatih Karahan said measures to contain risks spreading from funds subject to trading restrictions had limited the impact on the financial system.

In a presentation in Bangkok on Oct. 14, he outlined increased repo funding, eased borrowing limits and collateral requirements, and accelerated purchases of securities linked to the Turkish Lira Overnight Reference Rate.

The bank also raised the credit growth cap for small and medium-sized businesses from 4.5 percent to 5 percent.

Karahan said fund outflows had not significantly weakened residents’ preference for lira-denominated assets.