Page 23 - TURKRptNov20

7.1.3​ NPLs
The two companies building the stalled Etlik mega hospital in Ankara, Italy’s Astaldi and Turkey’s Turkerler, have agreed on September 11 with 13 banks and finance companies, including three private Turkish lenders, to obtain €1.1bn to refinance​a previous €900mn loan and new costs, unnamed sources t​old​Reuters on September 29.
The European Bank for Reconstruction and Development (EBRD), which has invested some 650mn euros in big city hospitals in Turkey in recent years, confirmed to the news agency that it signed off on the deal that should allow construction of Etlik to resume.
When Turkey’s boom years came off the rails in August 2018 during the lira crisis some PPP loans, mostly denominated in euros, turned into a huge burden for investors. Some projects came to a standstill, others got bogged down in cost overruns.
“​Restructuring negotiations are continuing for other PPPs that are in trouble,​” the person added.
Under the PPP model, Ankara guaranteed a certain amount of income for the hospital construction companies for a set period. But t​he loans, totalling some $10bn for 17 hospital projects,​were often denominated in euros while lease payments were indexed to euros but denominated in lira.​
Another hospital building consortium consisting of Turkish groups Gama and Turkerler and the US’ General Electric has l​aunched​talks with banks in Turkey to restructure €900mn​of loans.
Although ​Turkey r​eports​a relatively low level of NPLs,​the authorities have this year moved to provide more generous definitions of what is and what is not an NPL, while there has been a surge of lending in a drive for growth based on cheap credit which it is too early to place under the microscope.
S&P Global Ratings said on June 23 that it forecasts problematic loans at Turkish banks will grow to more than 20% by 2021.​
Turkish state and university hospitals are offering to repay debts totalling some Turkish lira (TRY) 19bn ($2.43bn) to drugmakers and medical equipment firms, but with a discount,​sources t​old​Reuters.
US Ambassador to Ankara David Satterfield ​said​earlier in September that Ankara owed $2.3bn to pharmaceutical companies, including US ones, and warned that the foreign companies would leave Turkey unless they were paid. The debts were up from $230mn a year ago, he said.
Capital or financing support could be provided to the flagship carrier Turkish Airlines by the Turkey Wealth Fund (TVF)​though nothing had yet been finalised, Reuters r​eported​four sources as disclosing on October 2.
Turkish billionaire Ferit Sahenk’s Dogus Holding is in preliminary talks with a group of banks to delay repayments on €2.3bn ($2.7bn) of debt that was restructured in April 2019​after its cash flows took a knock because of the coronavirus (COVID-19) pandemic, according to people familiar with the matter ​cited​by Bloomberg.
Turkey’s Bereket Enerji, owned by Ceyhan Saldanli, has launched talks with nine local lenders to restructure $3.9bn of loans,​people with knowledge of the matter t​old​Bloomberg on October 15. In 2019, Bereket, which operates power plants and two grids, restructured $5bn of debt.
23​ TURKEY Country Report​ November 2020 ​ ​www.intellinews.com