Borsa Istanbul will replace more than a quarter of the constituents of its benchmark BIST-100 index, its biggest reshuffle since it announced new market structure rules six years ago, following a regulatory crackdown on investment funds, the exchange said on Tuesday.
The exchange did not provide a reason for the reshuffle, which will take effect in October. Turkey's Capital Markets Board introduced concentration limits for hedge funds following last week's steep selloff that came after new rules created liquidity pressure at investment funds.
Regulators have recently updated how they calculate free-float rates, which left out some fund holdings too.
Factoring company Destek Finans BIST:DSTKF and financing firm Katilimevim BIST:KTLEV will leave the BIST-100, while conglomerate Anadolu Grubu Holding BIST:AGHOL and fast-food retailer TAB Gida BIST:TABGD will return after being removed in the previous period, the exchange said.
Esenboga Elektrik BIST:ESEN, Isiklar Enerji Yapi Holding BIST:IEYHO and Odine Teknoloji BIST:ODINE, which joined the BIST-100 in the previous quarterly reshuffle, will also be removed.
Destek Finans will also exit from the BIST-30 for TR Anadolu Metal BIST:TRMET.
BIST-30 companies are exempt from the new concentration limits, and a stock's removal will require funds to reduce their holdings.
FUND INVESTIGATION
The benchmark on Tuesday was flat at 0710 GMT, and just up 0.4% so far this week after plunging about 8% last week.
As part of authorities' intervention to shore up market stability, the Capital Markets Board mandated Isbank and Ziraat Bank to oversee the liquidation of 131 investment funds managed by seven portfolio management companies, including Tera Portfoy TPYTI.IS, Pusula Portfoy and Hedef Portfoy, on the TEFAS electronic fund trading platform.
These funds hold large positions in stocks such as Destek Finans that are being removed from the indexes.