Minister of Treasury and Finance Mehmet Şimşek made statements regarding investment funds for which the liquidation process was initiated by the Capital Markets Board (SPK). Speaking on a live broadcast on Habertürk, Şimşek stated that the final liquidation could take time and that preparations for an interim payment mechanism for small investors and money market fund investors have been completed.
Şimşek expressed that after the regulation currently being discussed in the TBMM is accepted, they aim to make payments of up to 1 million liras depending on the availability of resources in the funds. Minister Şimşek emphasized that the process is being conducted with the principles of “transparency, efficiency, and fairness” and that no public funds will be used, adding: "With the resources to be recovered, individuals will most likely be able to get back the money they invested, although this may vary from fund to fund."
40.8 BILLION LIRAS PAID TO 45,747 ACCOUNTS
According to the information provided by Şimşek, a total of 131 funds under seven portfolio management companies have been taken into liquidation. The ordinary liquidation of 66 of these has been completed; the process for three portfolio management companies has concluded. In this context, 40.8 billion liras have been paid to 45,747 accounts.
Stating that money market fund investors received an additional return of 1.43 percent based on the value as of September 17, Şimşek said that in equity-intensive funds, investors were able to receive approximately 58 percent of their payments due to a decline in value. Şimşek stated that this difference stems from the drop in the value of the stocks.
Conveying that the normal liquidation process is also on the agenda for the funds under the Hedef Portfolio Management Company, Şimşek noted that the company owners and managers have returned assets and money. Stating that there are 31 funds in Hedef Portfolio, four of which are money market funds, and that there are a total of 23,925 accounts, Şimşek noted that the process is aimed to be completed this week.
Reporting that the process regarding the Terra, Pusula, and Atlas portfolio management companies under extraordinary liquidation is ongoing, Şimşek said that if the law is accepted, small investors and money market fund investors will be prioritized in these companies as well. According to Şimşek, if payment capacity is established, payments of up to 1 million liras could be made to approximately 390,000 accounts.
EMPHASIS ON VOLUNTARY REPAYMENT AND LEGAL PROCESS
Şimşek announced that a recovery mechanism is being worked on against the possibility of insufficient resources in companies under extraordinary liquidation. Stating that the Ministry of Treasury and Finance, the Savings Deposit Insurance Fund (TMSF), the Ministry of Justice, and the Central Registry Agency are working together, Şimşek said that individuals and companies that obtained excessive gains from the funds or from manipulated stocks have been identified.
Stating that separate accounts have been opened for 131 funds, as well as a general repayment account, Şimşek expressed that they aim to provide resources through two channels: voluntary repayments and legal processes. Şimşek reported that for those who do not make voluntary repayments, the legal process will be initiated through the Ministry of Justice, and that the personal assets of managers, partners, and those acting in concert may be pursued.
Stating that the capacity of regulatory and supervisory institutions will be strengthened to prevent similar problems from recurring in capital markets, Şimşek noted that stronger measures and sanctions for market fraud, insider trading, market-disrupting activities, and coordinated transactions are on the agenda.
Emphasizing that the implementation of the fund guide will not be postponed, Şimşek said that transparency has increased with the guide and that restrictions have been placed on transactions made with related institutions. Stating that whether free funds should be open to TEFAS is also being evaluated, Şimşek expressed that they are working in dialogue with the sector for comprehensive regulation.
Şimşek also argued that developments in the fund market do not pose a systemic risk to the banking system. Stating that the direct risk of banks to problematic funds is 1.3 billion liras, Şimşek said that this amount remains limited within the 56 trillion liras of banking assets. Reporting that the net outflow from funds has reached approximately 647 billion liras, Şimşek stated that 287 billion liras of this was foreign outflow and that the money leaving has largely shifted to deposits.
News Source: 12punto
