Turkey's market regulator chief, Mahmut Sutcu, stepped down on Monday amid the fallout of a fund crisis that has upended the country's markets. Sutcu cited "health issues" as the reason, according to state-run Anadolu Agency. He had been in the role since May.
His resignation coincides with growing scrutiny from government officials and the public over whether the Capital Markets Board (SPK) failed to prevent what the justice minister has termed a "Ponzi-like scheme" among many high-profile investment funds. Prosecutors are investigating whether Sutcu's predecessor, Ibrahim Omer Gonul, failed to adequately supervise funds whose astronomical returns raised suspicions months before redemption-request failures sparked an investor exodus in September. Sutcu was one of Gonul's deputies at the time. Dozens of executives from asset managers including Tera Portfoy Yonetimi AS and Pusula Portfoy Yonetimi AS have been jailed pending trial in the same investigation.
Osman Celik, Turkey's Deputy Treasury and Finance Minister, also submitted his retirement petition on Monday. Turkey's benchmark Borsa Istanbul 100 Index extended losses to as much as 2.8% before trading 2.4% lower. Investors had looked to Sutcu to tighten restrictions on funds' exposure to thinly traded stocks and improve trading transparency. An SPK guideline published in August failed to please most market participants and triggered heavy withdrawals from certain funds. The SPK has since ordered 131 funds with nearly half a million investors into liquidation.
Treasury and Finance Minister Mehmet Simsek said Turkey plans to complete legislative changes in capital markets regulations by the start of 2027 to combat offenses, including coordinated transactions by funds. During a parliamentary session on Oct. 14, SPK deputy president Ahment Aksu said the regulator would accept the outcome of any review determining its culpability. Sutcu did not attend the session.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing