Page 16 - TURKRptOct22

After Nebati said what he said, there were plenty in the mainstream who defended the minister by, putting it politely, saying he was only guilty of the blunder of one not very experienced as the political head of a ministry. Yes, he made an ass of himself, but his words were not proof of direct government involvement in the “silkeleme” for the “silkeleme” did not exist.
However, there was one not so negligible detail. When some stocks, for no identifiable reason, make a concerted attempt at bulldozing the price ceiling, Borsa Istanbul is obliged to ask the concerned company whether there is some news not filed to the public disclosure platform (KAP) that it should know about. But Borsa Istanbul did not ask the concerned banks whether they had something to disclose about what was going on.
There remain some unanswered questions about the government’s participation in the scheme. The government has an unlimited supply of lira. It could have forestalled the ongoing downswing. But it did not do so.
The boom in the banking stocks was driven via the Borsa Istanbul Derivatives Market (VIOP) over leveraged positions. Following the plunge, the margin calls generated a crisis.
Ahlatci Yatirim, a brokerage owned by an Erdogan-supporting businessman, Ahmet Ahlatci, was identified as carrying the biggest short position. The brokerage owner responded that Mehmet Akdere, a customer and well-known market “masseur”, was carrying the position, not the brokerage. He also said that Akdere was carrying out transactions via 10 more brokerages, not just through Ahlatci. You’d be hard-pushed, of course, to find observers who buy the story that the whole scheme was carried out by a single player.
So, as per usual with Turkey and its markets, the identities of the perpetrators are not clear. And it can be expected that they will never be clear.
At the height of the rally, the Akbank pension fund announced on September 13 the sale of a 0.15% stake—an obvious bid to benefit from the price surge. Akbank (AKBNK) is a unit of industrial conglomerate Sabanci Holding (SAHOL). So, it would seem that Akbank and Sabanci were not involved in the scheme.
The price collapse, meanwhile, continues. As the margin calls come in, the capital of brokerage houses is eroded. When the customers cannot fulfil their margin call obligations, the brokerages are supposed to do it in their stead.
On September 20, government-run Halkbank (HALKB) and Isbank (ISCTR) were seen buying up their own shares on the market. Halkbank said that it purchased 3% of its own shares. The Isbank pension fund said that it bought a 0.05% stake in Isbank.
There appear to be stakeholders of all sizes who took part in the rally who are currently trying to avoid a systemic shock.
Later on, Turkish clearing house Takasbank acted to provide liquidity to brokerages and take on some stocks as collateral. That helped to stabilise shares in Turkish lenders Sekerbank (SKBNK) and TSKB (TSKB).
16 TURKEY Country Report October 2022 www.intellinews.com