Istanbul Stock Exchange Plummets as Pusula Portföy Fails to Meet Redemptions
The Istanbul Stock Exchange plunged after fund manager Pusula Portföy failed to meet investor redemptions, triggering a 5.54% drop in the BIST 100 and massive capital outflows.
Turkey's economy faces a sharp crisis as the Istanbul Stock Exchange plummeted following news that Pusula Portföy, a major fund management company, failed to make timely redemptions to investors. The BIST 100 index plunged up to 6.78% before closing down 5.54% at approximately 13,122 points, triggering trading halts.
Market-Wide Collapse and Massive Outflows
The turmoil began when reports emerged that approximately 129 billion liras, equivalent to about $2.7 billion, had been withdrawn from Pusula's funds since late August. Simultaneously, talks regarding the transfer of shares from Pusula Finans Holding and its subsidiaries to the Terra group faced uncertainty, prompting the Turkish Capital Markets Board to launch investigations into industry executives.
"The sudden liquidity crunch at Pusula has severely shaken investor confidence across the entire Turkish financial sector," market analysts noted.
Sector Impact and Economic Fallout
While Pusula is not a traditional banking giant, its reach is extensive, including holdings in Katılımevim—which facilitates interest-free asset acquisition—retail financing, and the Islamic investment bank İktisat Bank.
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Banking index dropped by 6.38%
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Holding index fell by 6.48%
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Leasing and manufacturing sector plunged by 9.74%
With presidential elections approaching, President Recep Tayyip Erdoğan faces an immediate and critical test to restore stability to Turkey's volatile financial markets.
