Turkey Bans Short-Selling, Eases Buybacks to Stem Market Slide

Ugur Yilmaz

Sun, Mar 23, 2025, 2:31 PM 1 min read

(Bloomberg) -- Turkey’s capital markets regulator imposed a ban on short-selling across all stocks and relaxed share buyback rules in a bid to prevent further deterioration of the market, which saw the country’s benchmark index tumble 17% following the detention of a prominent opposition leader.

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The new rules, announced late Sunday, broaden a previous ban that limited short-selling to only the top-50 listed companies. In addition, the regulator has allowed listed companies to repurchase shares at prices above the last market close and reduced the minimum equity capital protection requirement for margin trading to 20% from 35%.

The moves come in the wake of the arrest of Istanbul Mayor Ekrem Imamoglu, a key rival to President Recep Tayyip Erdogan. Imamoglu’s detention last Wednesday sparked a market rout, sending the Turkish lira to an all-time low against the dollar and driving bond yields higher. The banking stocks index posted its steepest weekly decline since at least 2001. In response, the central bank raised a key interest rate in an unscheduled meeting on Thursday, while maintaining its benchmark rate.

As markets prepare for Monday’s volatile session — the first since Imamoglu’s arrest— the central bank held talks with top banking executives on Sunday, according to people familiar with the matter. The Turkish lira was quoted at 37.95 per dollar in early Asia trading as of 12:09 a.m., according to Bloomberg’s BGN indicative pricing.

The measures are set to remain in place until the market close on April 25.

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