Turkey’s central bank suspended until year-end a requirement that banks with a real annual loan growth rate above 15% must keep their adjusted rate below 15%, so they can keep credit flowing as the economy reopens from the coronavirus lockdown.
The revision would allow lenders to take advantage of separate regulatory incentives for them to meet the borrowing needs of firms and individuals, which have risen and will likely stay high, the Central Bank of the Republic of Turkey (CBRT) said on Saturday.
“The circumstances of the coronavirus pandemic had adverse impacts on cash flows, increasing the loan demand of both individuals and firms. Measures put into effect ensured the efficient functioning of the credit mechanism, and the increased loan demand was met to a considerable extent. This trend is expected to continue for a while in the normalization process as well,” the bank said in a statement.
The revision is effective as of the June 12 calculation date, with the maintenance period starting June 26 and running through year-end.