“Concordat” analysis from the CBRT: Demands of stressed firms may increase periodically
In the analysis titled “A Close Look at Concordat Developments” published on the Central Bank of the Republic of Turkey’s (CBRT) blog, it was stated that concordat requests in this year were concentrated in firms that could be considered in the risky category and had a relatively low weight in the economy even before the monetary tightening.
An analysis titled “A Close Look at Concordat Developments” prepared by Chief Advisor Halil İbrahim Aydın, Assistant Specialist Kadir Gürci and Structural Economic Research General Manager Ünal Seven was published on the CBRT website.
In the analysis, it is stated that firms under financial stress can request concordat in order to obtain ease of payment while continuing their activities, “The concordat provisions in the Enforcement and Bankruptcy Law aim to extend the debtor’s debt, reduce its debt or avoid a possible bankruptcy. In this article, we analyze the relationship between recent concordat requests and financial conditions.”
In the analysis, it is stated that firms’ indebtedness, debt repayment capacities and liquidity conditions are determinant in concordat processes.
In the analysis, it is seen that the general indebtedness level of concordat firms is higher compared to other firms and their liquidity levels are significantly lower, “While the ratio of trade debts of these firms to total assets is 36 percent, this ratio is 11 percent in other firms. Similarly, the median of the ratio of cash and bank accounts, which are called liquid assets, to short-term liabilities of concordat firms is approximately 2 percent, while this ratio is around 8 percent for other firms.”
English 
Turkish