Markets regulator chairman urged to resign due to delayed closure of stock exchange

Turkey’s main opposition leader has called on the president of the country’s markets regulator, the Capital Markets Board (SPK), to resign due to the delayed closure of the İstanbul Stock Exchange (BIST) in the aftermath of a powerful earthquake on Feb. 6, Turkish media outlets reported.

A 7.8-magnitude earthquake rocked parts of southern Turkey and northern Syria in the early hours of Feb. 6, claiming more than 35,000 lives so far. It is the strongest to hit Turkey since 1939, when an earthquake of the same magnitude killed 30,000 people, according to the United States Geological Survey.

BIST announced only on Wednesday, two days after the earthquake, that it would close for five days in response to the disaster, which was the first such shutdown since 1999.

Leader of the main opposition Republican People’s Party (CHP) Kemal Kılıçdaroğlu and business experts say the delayed closure caused small investors in the 10 quake-stricken provinces to sustain financial losses since they were unable to engage in any transactions on the stock exchange in the two days following the earthquake.

Kılıçdaroğlu went to SPK headquarters in Ankara on Monday to meet with SPK President İbrahim Ömer Gönül and ask for his resignation due to the delayed closure of BIST. Gönül, however, refused to meet with the opposition politician.

The opposition leader said approximately 380,000 investors who live in the earthquake-stricken cities of Turkey have been robbed of their savings.

“What does it mean to rob someone in the aftermath of an earthquake? Everyone should raise their voices against it when when it is done by a state agency,” Kılıçdaroğlu told reporters.

He also called on the government to determine the financial loss suffered by the small investors in the earthquake zone due to the delayed closure of BIST and to compensate their losses.

BIST cited an “increase in volatility and extraordinary price movements after the earthquake disaster” in its decision, after which it suffered sharp losses before suspending trading on Wednesday morning.

“Considering the low transaction volume that does not allow efficient price formation, all trades executed in the closed markets on February 8, 2023 will be cancelled,” it added, noting it would remain closed until the evening of February 14.

The last time it suspended trading was after a 1999 quake that killed more than 17,000 people.

Some politicians are calling for all trades conducted since the earthquake to be cancelled.

“It’s not enough to close. The trading done on the İstanbul Stock Exchange since the earthquake should be cancelled,” CHP lawmaker Murat Bakan said.

“This would be to protect the rights of 500,000 small investors who are under the rubble, who died or who await rescue and have no access to the internet,” he tweeted.

The disaster hit at a time when Turkey is battling economic crises on several fronts. Annual consumer price inflation peaked at 85.5 percent in October, before decreasing. But in January prices were still 57.7 percent higher than the same month last year, according to the Turkish Statistical Institute.