Page 54 - TURKRptFeb22

7.1.3 NIMs & CARs
The share of FX-linked deposits in total deposits placed with Turkish banks has leapt to record highs.
Problem loans officially hover around 15%.
Since 2016, many essentially bankrupt companies in Turkey have been kept afloat with cheap loans. Ongoing ‘regulatory forbearance’ and the restructuring of loans hide the real picture, but the banks’ balance sheets, weighed down by non-performing loans (NPLs), are in fact among Turkey’s most serious headaches.
The public banks are not even able to release some baseless figures on growing profitability.
The contractors behind giant infrastructure black holes along with energy, construction, tourism, airline and retail companies, as well as a great number of small and medium sized enterprises (SMEs) in Turkey, are all found within the debt restructuring spiral.
Banks only bankrupt when governments want them to bankrupt. Erdogan and his officials are not seeking bank bankruptcies, but some cash injections are required.
The regime achieves this by exchanging some government papers among the Treasury, the wealth fund (TVF/TWF) and public banks. The owners of private banks have to cough up.
54 TURKEY Country Report February 2022 www.intellinews.com