Deputy PM defends call to remove SPK head

Deniz Zeyrek ROTTERDAM / Radikal

Deputy Prime Minister Ali Babacan has defended a recent decision to unseat the head of the Capital Markets Board (SPK), saying markets had reacted positively to the move.

“This kind of thing could only be decided instantly, not with prior notice, as I very well know from the private sector,” Babacan told reporters in Rotterdam regarding the removal of SPK head Vedat Akgiray and six other board members from their posts in a surprise motion he led that was approved by Parliament late Dec. 6.

Babacan said the Istanbul Stock Exchange (ISE) administration had also changed and they had started a renewal of the SPK from the top down. “We may continue with the remaining seven people, but we also may change some of them. We will determine the new committee when the president has signed the law. If this period of transition lasts any longer it may be a problem for the committee. When we did this, the market reaction might have been very different, but instead the stock exchange broke a record that day. We received messages on Twitter that said ‘well done.’ We cannot leave the SPK in the 1980s while we are renewing the ISE.”

Babacan visited Rotterdam right after the presentation of the 2013 budget in Parliament to attend a series of events to mark the 400th year of the establishment of diplomatic ties with the Netherlands.

In evaluating problems concerning bank charges on transactions and credit cards, Babacan said it was a necessity to keep the banking system strong. “Banks get most of their revenues from interest, therefore when the interest rates fell they had to put the weight on this kind of fixed transaction charge to protect their profitability. We are waiting for them to establish a balance.”

Babacan said it was important that the Competition Board consult on its evaluation of banks. “We should not make compromises on the Competition Board’s fundamentals, but the fines should not be so high as to undermine the financial stability of banks.”