Gov’t dismisses market czar, raising questions

ISTANBUL - Hürriyet Daily News

Capital Markets Board Chairman Vedat Akgiray (L) and Deputy PM alie Babacan (C) are seen at an Istanbul meeting on reform in financial markets in this February 2012 photo. Akgiray loses his seat in a market reform phase. AA photo

The head of Turkey’s Capital Markets Board (SPK), Vedat Akgiray, is losing his seat after a surprise motion was tabled by Deputy Prime Minister Ali Babacan and approved by Parliament late on Dec. 6.
The law, which also introduces significant reorganization of all Turkey’s bourses, will
come into force when it is printed in the Official Gazette. All six current members of the board are set to be unseated along with Akgiray.

The surprise move was taken as the current members of SPK do not meet the criteria defined by the new law, according to Borsagundem.com, a local finance newsportal, citing unnamed sources close to the government.

The SPK board and the government were aware of the new regulation, but it was kept from the public until the last minute, Borsagundem said.

There will be no assignments from the Treasury or the Finance Ministry, according to the new law. One member will be from the private sector, while one will be a legist and one will be an official from the SPK with at least 10 years of experience. The rest of the seats may be chosen from former SPK members, the newsportal said. The SPK board members and the president will be assigned by the beginning of the year at the latest.

Any corruption?

The main opposition leader reacted to the eleventh hour motion and demanded that the motive behind the move be explained.

“If it is a case of corruption, it should be laid open. The public has a right to know,” said Kemal Kılıçdaroğlu, the leader of the Republican People’s Party (CHP), during an Istanbul meeting. Laws regarding the SPK and the Istanbul Stock Exchange (İMKB) were pass during the military administration that followed the 1980 coup, he said, adding: “The İMKB, which had been a self-regulating organization, was nationalized. The government can control the bourse, but the Parliament cannot,” he said.

According to the new law, companies will have to present an offering memorandum, which will be subject to SPK approval, for public offerings and to be traded at the exchange. The issuers will be responsible for incorrect information provided via memorandums. The İMKB and the Istanbul Gold Exchange will be merged under “Borsa Istanbul” and the premises of the İMKB will be transferred to the Education Ministry. The headquarters of the SPK will be moved to Istanbul from Ankara.