Newsletters
Türkiye’s stock exchange, Borsa Istanbul, was roiled on Friday after a credit default rattled regional U.S. banks, sending major financial stocks tumbling worldwide amid rising concerns over sector risks and compounding pressure from a domestic fraud scandal involving the country’s payments regulator, the Interbank Card Center (BKM).
The benchmark BIST 100 index slid over 3% to the 10,000 level as of 09:00 a.m. GMT, marking its lowest point in more than three months. Both the broad and liquid banking stock indices fell by around 4%.
Türkiye’s largest lenders were hit hard, with QNB Finansbank down 7.2%, Garanti BBVA 4%, Akbank 3.7%, Isbank 3.7%, VakifBank 4.3%, Yapi Kredi 4.2%, and Halkbank 5%.
Following a more than 2% drop in the BIST 100 index, Türkiye’s stock exchange announced that the "up-tick rule" will apply to all short-selling transactions in equities eligible for short sales on the Equity Market until the end of the trading session.
Fresh credit concerns and fraud allegations reignited fears over banking sector stability after regional U.S. banks, including Zions Bancorporation, Western Alliance, and Jefferies, reported losses and legal troubles linked to bankrupt auto lenders and alleged loan fraud, sending the SPDR regional banks ETF down 6.3% on Thursday, with all three major Wall Street indices ending the day in the red.
On Friday, major indices also fell sharply across global markets, driven by steep losses among banking stocks. Japan’s Nikkei 225 closed down 1.4% at 47,582.15, Hong Kong’s Hang Seng Index dropped 2.5% to 25,247.10, and Shanghai’s Composite fell 2.0% to 3,839.76. In Europe, London’s FTSE 100 declined 1.6% to 9,288.14, while Paris’s CAC 40 slipped 0.83% and Germany’s DAX 30 plunged 2.13%. Europe's broader stock index, the STOXX 600, was also down 1.4%.
Among major banks, Germany’s Deutsche Bank shares slumped nearly 7%, the U.K.’s Barclays fell 6%, Standard Chartered dropped 5%, France’s BNP Paribas declined 4%, and the Netherlands’ ING slid more than 3%.
The CBOE Volatility Index (VIX) jumped by nearly 30% to a six-month high at 27.24, as banking woes, renewed U.S.–China trade tensions, and the ongoing federal government shutdown rattled investor sentiment.
Adding to growing fears over the banking system, Turkish authorities on Friday detained eight people, including former Central Bank Deputy Governor Emrah Sener, in a sweeping fraud investigation into the Interbank Card Center (BKM) — the domestic card payments regulator majority-owned by the Central Bank of Türkiye (TCMB).
The probe, launched after the TCMB’s internal audit uncovered irregularities, alleges misconduct in two major tenders for chip card procurement and software development for Türkiye’s TROY payment system, resulting in public losses exceeding ₺100 million ($2.38 million), according to Halk TV. Investigators claim the contracts were unlawfully awarded to a single company, Enarge, without proper competition or delivery verification.
Sener, BKM’s former CEO Baran Aytas, and his deputy Bora Koc are accused of embezzlement, fraud, bid rigging, and forming a criminal organization. Court documents also cite unauthorized transfers, including payments to a shell company in Singapore and funds sent to Sener’s brother.
In response to the reports, the Central Bank of the Republic of Türkiye (CBRT) confirmed it had filed a criminal complaint in December 2024 following its audit findings, adding that the ongoing judicial process "is being closely monitored by the Bank and BKM."
1 min read
3 min read
