Turkey fund crisis erases $30 billion as regulator liquidates 131 funds

September 25, 2026 at 01:54 PM2 min

This digest was compiled by AI from multiple sources — links to the originals are below.

Turkey's capital markets regulator has moved to liquidate 131 investment funds after a wave of redemption failures triggered a sell-off that erased about $30 billion from Borsa Istanbul in two days. The benchmark BIST 100 index fell more than 8% in the week, its worst weekly performance since March 2025. The intervention follows revelations of extraordinary returns at some funds, including one that rose over 60,000% in three years.

Key Facts

Turkey's Capital Markets Board (SPK) has placed 131 funds under liquidation, affecting 455,758 unique investors and approximately $18 billion in assets.
The BIST 100 index fell more than 8% in the week, its worst weekly performance since March 2025, according to Reuters data cited by The Economist.
One Tera fund rose over 60,000% in three years, while Destek Finans Faktoring shares gained about 7,000% within 17 months of its IPO, becoming Turkey's second-largest listed company by market value.
The Economist warned that Turkey could lose its emerging market status due to the fund crisis.
Turkish Finance Minister Mehmet Şimşek had flagged problems in some stock market transactions since last year and announced upcoming regulations.

Market Collapse

On September 16, the main Borsa Istanbul index fell more than 5%, and the scandal erased about $30 billion in market value within two days. The BIST 100 closed the week down more than 8%, its worst weekly performance since March 2025, according to Reuters data cited by The Economist. The sell-off began when Tera and several other portfolio management companies struggled to meet investor redemption requests. The Economist reported that warning signs had emerged earlier, with Finance Minister Mehmet Şimşek flagging problems in some stock market transactions since last year.

Regulatory Intervention

The Capital Markets Board (SPK) intervened in funds managed by seven portfolio management companies, raising the number of funds under liquidation to 131. SPK data shows 455,758 unique investors hold shares in these funds, with total assets of about $18 billion. Türkiye İş Bankası was appointed to liquidate Tera Portföy funds, while Ziraat Bankası was assigned to funds of A1 Capital, Atlas, Bulls, Hedef, Pardus, and Pusula Portföy. The liquidation process is expected to be completed within three months unless extended by the SPK. Some managers have been arrested, and dozens of people face travel bans and asset freezes as part of the investigations.

Extraordinary Returns

The Economist highlighted that one Tera fund rose over 60,000% in just three years. Destek Finans Faktoring shares gained about 7,000% within 17 months of its IPO, making it Turkey's second-largest publicly traded company by market value. The magazine reported that some companies allegedly operated 'ponzi-like' structures, as described by an official to The Economist. The Economist warned that Turkey could lose its emerging market status due to the crisis.