XTB leaves Turkish market after the Turkish financial market regulators did not provide any signal of their intentions to review the limitations of Forex regulations. What now for the broker?
20 April, AtoZ Markets – Polish Forex broker XTB is eventually moving to implement its plans to exit the Turkish market. Reportedly, the brokerage plans to withdraw its regulation with the CMB, the key financial regulator in Turkey, as per the corporate statement.
XTB Leaves Turkish Market: What are the reasons?
Earlier in November 2017, XTB has stated that it might suspend its plans to stop operations in Turkey until the middle of 2018. However, after the Turkish financial market regulators did not provide any signal of their intentions to review the limitations of Forex regulations, the brokerage has decided to cease its operations in the country via liquidating its subsidiary X Trade Brokers Menkul Değerler. The official report of XTB stated that:
“The decision of the Company was made after analyzing the situation of the subsidiary and in the absence of the expected relaxation of the restrictions introduced by the Capital Markets Board of Turkey (CMB), which the Company informed in the current report No. 5/2017. In addition, the Company informs that due to the decision on withdrawing from the Turkish market and liquidation of X Trade Brokers Menkul Değerler A.S., on the same day, the Management Board updated the Strategy of the XTB Capital Group.”
In spite of the unclear situation within the Turkish market, the brokerage’s strategy entails moving on with its expansion plans, as it sets goals for the international growth. It is known that XTB is looking into solidifying its position in Latin America, Africa, and Asia. XTB has also informed its shareholders that is plans to utilize its presence in Belize as a starting point to expand to the Latin American countries. While the brokerage has the presence in Belize, it is able to offer Latin American customers a region-specific service.
Why did XTB decide to leave Turkey?
Earlier, the brokerage has stated that it expects that the Turkish regulatory plans will largely decrease the overall activity within the Turkish retail Forex trading market. The company has also noted that these changes to the regulatory framework have caused a significant drop in the number of customers and, as a result, to a significant reduction in the activity of XTB Group in the Turkish market.
The decision of XTB to exit Turkey was also, in part, based on the recent Turkish economic and political situation. The company believes that the environment has impacted the business sectors and contributed to the turmoil in the market. Furthermore, XTB adds that thanks to the recent jump in Turkish lira volatility, the company is not able to exactly assess the financial costs of this decision.
We have reached out to the company for further insight into the case.
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