Tera Portfoy Funds Default on $7.5 Billion in Redemptions

Tera Portfoy Yonetimi AS announced that its Money Market Fund (TP2) and Equity Intensive Fund (THF) failed to meet redemption requests. The affected funds hold combined assets of 366 billion liras, or approximately $7.5 billion. This default follows similar failures by Pusula Portfoy and redemption limits imposed by Atlas Portfoy.

The instability triggered a sharp decline in Turkish stocks, with the Borsa Istanbul 100 Index falling as much as 7.7% on Wednesday. Market concerns center on Tera's strategy of building concentrated positions in illiquid Turkish stocks to drive high returns.

Tera Chairman Emre Tezmen described the situation as an "extraordinary and unprecedented" speculative attack. In response to the broader market volatility, the Financial System Stability Committee of Turkey scheduled a meeting for September 17 to address the defaults.