(Bloomberg) — Tera Portfoy Yonetimi AS said two of its funds with a combined 366 billion liras ($7.5 billion) in assets failed to meet redemption requests, making it the second Turkish asset manager to announce defaults on some funds this week.
Defaults have occurred in redemption payments for Tera Portfoy Money Market Fund (TP2) and Tera Portfoy Equity Intensive Fund (THF), the Turkish asset manager said in two separate filings to Borsa Istanbul.
Tera Portfoy is a Turkish asset manager whose funds have attracted large inflows after posting some of the highest returns in the country’s investment-fund market in recent years. TP2 and THF are Tera’s second- and third-largest funds, with portfolio sizes of 224 billion liras and 142 billion liras, respectively, according to Tefas.
“Reconciliation with the brokerage firms that conducted transactions through the relevant fund account, as well as the liquidity management process, is ongoing. All necessary measures are being taken with due care, and we will continue to keep our investors informed of developments regarding the matter,” Tera said.
Turkish stocks suffered sharp losses on Wednesday, after another asset manager Pusula Portfoy said it failed to meet redemption requests for some of its funds. The Borsa Istanbul 100 Index fell as much as 7.7% and closed 5.5% lower. Another asset manager, Atlas Portfoy, also said it will limit redemptions on one of its funds. Turkey’s Financial Stability Committee said it will convene at 8 a.m. on Thursday, Sep. 17.
Tera had become a focal point for concerns over the risks created by funds building large, concentrated positions in relatively illiquid Turkish stocks. The firm’s main investment funds have gained a cult following on social media for their astronomical returns, achieved by pouring billions of lira into a tight circle of related companies.
Tera Chairman Emre Tezmen said the firm was facing an “extraordinary and unprecedented” speculative attack that risked spreading across the markets, in a post on X.
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