Clearstream, Euroclear to Resume Lira Trades on Shared Platform

(Bloomberg) -- Clearstream Banking SA and Euroclear Bank SA will resume settling lira transactions over a shared platform after they were exempted last week from trading limitations imposed by the Turkish regulator.

The settlement of Turkish lira trades over the “Bridge” will resume on June 1, Clearstream said in a statement on its website Thursday. The clearing houses had decided to suspend lira transactions on the platform on May 14, saying they couldn’t settle trades “under satisfactory conditions” due to the restrictions.

Turkey’s banking regulator, or BDDK, has effectively banned local banks from trading the lira with foreign institutions by capping the amount they can lend offshore to just 0.5% of their equity. While the measures are designed to stand in the way of short sellers, they have rippled beyond the currency market and hampered foreign investors’ ability to trade Turkish assets.

Last week, BDDK said Clearsteam and Euroclear would not be subject to the trading curbs to ensure lira securities were traded effectively. On May 11, it lifted a ban on trading liras with BNP Paribas SA, Citigroup Inc. and UBS Group AG, just days after the restriction was imposed.

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