Borsa İstanbul organized the third of the forum series entitled “İstanbul: Regional Hub, Global Actor” in London on January 20, 2015. The first two events were held earlier in Washington, D.C. and New York City.
Prime Minister Ahmet Davutoğlu, Deputy Prime Minister Ali Babacan, and Minister of Finance Mehmet Şimşek participated in the Forum, which analyzed Turkey’s advantages, the steps that have been taken so far for making İstanbul a financial center, and the further steps that need to be taken towards this purpose.
Speeches by Prime Minister Ahmet Davutoğlu and Deputy Prime Minister Ali Babacan
In his speech at the Forum, Prime Minister Ahmet Davutoğlu said that in order to understand the modern economy, one needs to understand London; and in order to understand the conventional economy, one needs to understand İstanbul. The Prime Minister went on to say, “These two traditions come together to make the global economy. London, the center of modern economy, comes together with conventional markets in order to overcome the difficulty in the capital markets. This unison is that of the global economy and conventional economy. Bringing together the Turkish economy and the UK economy may also offer a solution for the European Union”.
Deputy Prime Minister Ali Babacan pointed out to the fact that Borsa İstanbul is the heart of the Turkish capital markets, and the most important institution for the future of the markets; adding that the partnership agreement signed between Borsa İstanbul and the London Stock Exchange is the first step of the further agreements that Borsa İstanbul will enact in the future.
Congratulating both Exchanges, Babacan said, “London is a very important financial center … İstanbul, on the other hand, is a developing financial center... These two institutions have a lot to do together”.
İstanbul and Turkey “The Shining and Rising Star of the Crescent”
In his opening speech at “Turkey: Discover the Potential” Forum, Borsa İstanbul Chairman & CEO Dr. İbrahim M. Turhan said that they define İstanbul and Turkey as “the shining and rising star of the crescent”, adding, “As you know, the crescent represents the location in the Middle East where civilization was born, yields were produced and savings were accumulated. Furthermore, we are proud of the crescent since it represents the flag of the Republic of Turkey”.
“One of the most important reasons that we are here today is the strategic business partnership agreement we will sign between Borsa İstanbul, London Stock Exchange, and LCH. Clearnet. With this agreement, derivative products issued in Turkey and traded on Borsa İstanbul will start being traded on the London Stock Exchange’s markets. We will start with single stock and index futures and options, but we aim to widen the range of products”.
Emphasizing that they will make İstanbul a global financial actor to reflect Turkey’s economic power and the potential of the whole region, İbrahim Turhan went on to say, “What inspires us here is the path that esteemed Prime Minister, our government and esteemed ministers have put forward for us. I would like to express our gratitude for the contributions of both our government and the Capital Markets Board of Turkey”.
İbrahim Turhan concluded his speech as follows:
“Thanks to the structural transformation, horizontal integration, vertical integration, strategic partnerships, as well as the steps we have taken with regard to sustainable exchanges initiative through corporate governance in the last three years, we have climbed 31 ranks up in the list of Sustainable Exchanges, to 11th rank. We also rose from 72nd rank to 42nd in the list of international financial centers evaluated by independent institutions. This success is a humble effort to be worthy of the Turkish real sector, and our exporters that we take great pride in”.
A New Era in the Perception of Turkey Brand
In his welcoming remarks at the Forum, Chairman of the Turkish Exporters Assembly, Mehmet Büyükekşi said that as the representative of 61,000 exporters, Turkish Exporters Assembly started a new era in the perception of Turkey's brand with the "Turkey: Discover the Potential" slogan.
"We are moving towards the target with the power we gain from İstanbul's dynamism which is moving fast towards becoming a financial center with its unique geographical position, high quality financial services and improving sustainable economy", said Mehmet Büyükekşi.
Büyükekşi added that making İstanbul a global commercial and financial center will be a milestone in this synergy to be created.
İstanbul: Regional Hub, Global Actor Panel
Mehmet Büyükekşi, Chairman of Turkish Exporters Assembly; Xavier Rolet, CEO of London Stock Exchange Group; Jacques Aigrain, Chairman of LCH. Clearnet Group Ltd.; Suneel Bakhshi, Chief Executive Officer of LCH. Clearnet Group and Meyer "Sandy" Frucher, Vice President of NASDAQ spoke at the panel which was moderated by Artunç Kocabalkan, Chairman of İstanbul Financial Center Initiative. The participants shared their views about the competitive advantages and the opportunities offered by Turkey.
“London Stock Exchange Group is the natural partner for Borsa İstanbul as the Turkish capital markets rapidly develop into a major regional financial hub”
In his speech at the panel, Xavier Rolet, CEO, London Stock Exchange Group, said, “Turkey is one of the world’s most exciting emerging markets: it is blessed with a young, entrepreneurial population and an ongoing commitment towards building a financial system that supports the development of its high growth companies and industries. London Stock Exchange Group is the natural partner for Borsa İstanbul as the Turkish capital markets rapidly develop into a major regional financial hub, alongside the Istanbul Financial Centre initiative“.
Turkey offers an Enormous Potential for International Investors
Jacques Aigrain, Chairman of LCH. Clearnet Group Ltd stated that with a near-trillion-dollar GDP and export-oriented economy, Turkey presents enormous potential to international investors. “This agreement is an important step in the ongoing development of LCH.Clearnet’s offering, presenting our global customer base with the unique opportunity to trade and clear Turkish futures and options in international markets. It underlines our commitment to enhancing London’s position as the world’s most international capital market, working with Borsa İstanbul to help boost its liquidity and appeal to global investors”, said Aigrain.
Turkey is a Vibrant Emerging Financial Market
Suneel Bakhshi, Chief Executive Officer of LCH. Clearnet Group who also spoke at the Forum said: “LCH.Clearnet is one of the world’s leading multi-asset clearing houses, committed to open access. We are therefore delighted, alongside London Stock Exchange Group, to have agreed a recent partnership with Borsa İstanbul. Turkey is a vibrant emerging financial market, and offering our global customer base opportunities in new markets and new products is central to our strategy of being the world’s most trusted and innovative CCP.”
Partnership Agreement signed with the London Stock Exchange
The partnership agreement between Borsa İstanbul and London Stock Exchange that has been recently finalized was signed at the Forum.
Following the signing ceremony, Prime Minister Ahmet Davutoğlu, Deputy Prime Minister Ali Babacan, Minister of Finance Mehmet Şimşek, Justice and Development Party Vice President and Spokesperson Beşir Atalay, Chairman of the Turkish Exporters Assembly Mehmet Büyükekşi, Borsa İstanbul Chairman & CEO Dr. İbrahim M. Turhan and London Stock Exchange Group CEO Xavier Rolet had a family photo taken.
After the photo shooting, London Stock Exchange Group CEO Xavier Rolet presented gifts to Prime Minister Ahmet Davutoğlu and Borsa İstanbul Chairman & CEO Dr. İbrahim M. Turhan.
İbrahim Turhan presented Xavier Rolet a pair of Turkish coffee cups, and expressed his wish that the cooperation between the two institutions will be long term, saying, “We have a saying; the love of a cup of coffee lasts for forty years. We are presenting you two cups today, which makes 80 years”.
With the agreement, futures and options contracts on BIST 30 Index and single stocks traded on Borsa İstanbul Derivatives Market (VIOP) will start being traded on London Stock Exchange Derivatives Market. Clearing will be realized by LCH. Clearnet. Borsa İstanbul and FTSE will initiate an index partnership program in 2015.
The agreement is expected to provide liquidity for the financial derivatives traded on Borsa İstanbul and increase the depth and efficiency of Borsa İstanbul Markets.
Borsa İstanbul makes another Great Step
Borsa İstanbul made a further step towards its aim to extend its data dissemination infrastructure to London and make İstanbul a financial center.
As of January 2015, companies located in various places of the world will be able to access Borsa İstanbul data from Borsa İstanbul Point of Presence (PoP) located in Equinix, London without having to connect to İstanbul Data Center.
Technical infrastructure provides redundancy by two separate lines from İstanbul to London and one line from the Borsa İstanbul Ankara Disaster Recovery (DR) location to London. By this means, not only the İstanbul connectivity costs of data vendors, but also the Disaster Recovery connectivity costs will be eliminated. This step, which considerably reduces the international line and equipment costs of data vendors, is designed to enable order routing to Borsa İstanbul Markets in the near future.
Forum receives Great Support from Sponsors
Anadolu Agency was the media sponsor of the Forum. Participants enjoyed the products of Simit Sarayı and Kahve Dünyası, the catering sponsors of the event.