Brussels/Istanbul – 9 June 2020 – Euroclear Bank, the Brussels based international central securities depository (ICSD) and the Turkish Ministry of Finance have achieved a market first, with the imminent launch of a Euroclearable link to enable international investors unprecedented access to the local government bond market.
Countries achieving Euroclearability can potentially benefit in a number of ways, including foreign investors accessing the local market in a more secure and standardised way, local issuers have enhanced access to wider liquidity pools and can realise a potential reduction in the overall volatility of borrowing costs. According to a PwC study released last year, for countries that have recently obtained Euroclearability, the potential gain from lowering borrowing costs is associated with a GDP boost of USD 3.8 billion over 10 years.
Dr. Berat Albayrak, the Turkish Minister of Treasury and Finance Minister said: “This is an important milestone for our capital markets. Being able to tap into the liquidity provided by international investors through Euroclear is important for the continued development of our local debt markets. By making our TL, USD, EUR and gold denominated domestic borrowings entirely ‘Euroclearable’ we have further aligned our capital market framework with the globally recognised standards.”
Stephan Pouyat, Global Head of Capital Markets and Funds Services, Euroclear, added: “We are extremely pleased to be part of this watershed moment for the Turkish capital market. This has been a multi-year journey with Turkey to help establish the appropriate market conditions to achieve Euroclearability. The new legal and regulatory framework now enables Euroclear to extend our offering and provide a simple, efficient, cost-effective, risk minimising way of accessing the domestic Turkish government debt market. This is the result of a long standing relationship we have built with the Ministry of Finance and the competent authorities to align the needs of the Turkish market and those of the global investment community.”