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Home / Business / Turkish scales to probe JP Morgan after lira plunge

Turkish scales to probe JP Morgan after lira plunge



ISTANBUL (Reuters) – Turkey's banking dog said it had launched an investigation into JP Morgan and other banks over complaints it received after the lira had pulled over 4 percent and the main index index fell sharply on Friday.

FILE PHOTO: A JP Morgan logo is seen in New York City, USA January 1

0, 2017. REUTERS / Stephanie Keith / File Photo

BDDK watchdog said Saturday received complaints that a report JP Morgan published on Friday injured Turkish banks' reputation and caused volatility in the financial markets. The necessary "administrative and judicial processes" would be followed, it said.

Turkey Capital Markets Board (SPK) also said it had launched a probe after receiving complaints that a JP Morgan report was "misleading" and caused speculation on Istanbul bourse.

A spokesman for JP Morgan for the region refused to comment.

The Turkish lira tumbled over 4 percent against the US dollar on Friday, the biggest one-day case since a currency crisis took hold in August, claiming that Turks are buying more foreign cash as bonds with Washington worsen.

Supervisory authorities' actions are the latest official measures to counter the lira's sharp decline. The central bank said on Friday that a week's repo auctions had been suspended "for a period", a political tightening moves to push market liquidity and support the lira.

A copy of the JP Morgan report, seen by Reuters, said there was a high risk that the lira would decline after local elections set to March 31, and recommended that clients go further on US dollars. Such advice is typical of customer notes from banks globally.

BDDK also said it was stressing that "some banks" had led clients to buy foreign currency in a manipulative and misleading manner, and that the necessary administrative and judicial processes were to be followed.

The guard dog did not say which banks were, or whether they were Turkish or foreign.

The total forex deposits and funds including valuable metals by Turkish individuals hit record highs of $ 105.74 a week until March 15, showing central bank data on Thursday.

Friday's main index BIST100 was 3.45 percent on Friday, while the banking index fell 6.64 percent.

Further reporting by Umit Bektas and Nevzat Devranoglu; Editing by Clelia Oziel and Angus MacSwan

Our Standards: Thomson Reuters Trust Principles.

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