Turkey Signs Deal With Euroclear to Lift Foreign Demand for Debt
Turkey Signs Deal With Euroclear to Lift Foreign Demand for Debt
(Bloomberg) --
Turkey reached an agreement with one of the world’s biggest bond clearing systems to settle transactions in its debt market.
The deal with Euroclear will increase foreign investors’ access to bonds denominated in liras, dollars, euros and gold, Turkey’s Treasury said Tuesday on its website.
By making those domestic borrowing instruments “entirely ‘Euroclearable,’ we have further aligned our capital market framework with the globally recognized standards,” Treasury and Finance Minister Berat Albayrak was cited as saying in a statement published by Brussels-based Euroclear.
Rattled by measures that made it more difficult for international investors to bet against the lira, foreign funds have sold $7.9 billion worth of Turkish government bonds this year, more than halving their holdings. The outflows came amid a heavy debt repayment schedule that threatens to strain government finances and pile pressure on bonds.
“The new legal and regulatory framework now enables Euroclear to extend our offering and provide a simple, efficient, cost-effective, risk-minimizing way of accessing the domestic Turkish government debt market,” said Stephan Pouyat, global head of capital markets at Euroclear.
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