EBRD Turkish banking sector maintains strong capital structure

Commenting on the Turkish banking sector, Malige told AA correspondent that the EBRD’s cooperation with Turkish banks is long-term and the number of financing agreements signed with Turkish banks has increased recently.

“As of this time of the year, our investments in the Turkish banking and finance sector are at the level of 600 million euros, but the year is not over yet and we will continue until the end of the year,” Malige said, adding that last year, the finance sector accounted for 1.2 billion euros of the total 2.5 billion euros of investments in Turkey.

Francis Malige emphasized that the Turkish economy has started to come out of the high inflation period and is on the road to recovery, and stated that the Turkish banking sector has shown strong performance in this process.

Stating that he has been closely following the Turkish banking sector for about 20 years, Malige continued his words as follows:

“The Turkish banking sector has strong capital and liquidity buffers. This does not mean that there are no challenges. The biggest challenge in the sector right now is the instability created by the high interest rate environment, but now that there is a more stable macroeconomic policy, banks are coming out of this uncertainty. On the other hand, profitability in the sector is a bit volatile but we still see healthy profitability levels continuing. So I am not worried about the profitability of banks. Turkish banks are well capitalized and we are quite happy with our relationships with the banks.”

Reminding that orthodox macroeconomic policies have been implemented in Turkey for more than the last 12 months, Malige said, “It is very important to maintain orthodox economic policies. I think everyone, especially foreign investors and credit rating agencies, welcomes this turnaround in Turkey’s economic policies and trusts the fact that these policies exist and are permanent.”