Page 28 - TURKRptMay20

Despite concerns over a “coronavirus (COVID-19) sudden stop” in capital flows to emerging markets, Akbank has managed to again set the benchmark for its peers entering the Turkish lenders’ spring syndicated loan refinancing season.
Government-run Ziraat Bank, the largest lender in Turkey by assets, said it obtained a $1.1bn syndicated loan in two tranches of $415mn at a cost of Libor+2.25% and €597mn at Euribor+2%, according to a stock exchange filing.
The costs were identical to those of the benchmark set by Akbank earlier in April, while the rollover rate stood at 77%.
Eximbank needs to renew a $100mn loan in April along with Ziraat Katilim ($250mn) and Vakifbank ($1.1bn).
In May, Yapi Kredi Bank ($1bn), Garanti BBVA ($784mn) and Isbank ($1.03bn) will be in the queue.
Government-run Vakifbank has obtained a 3-year, $325mn loan from the Industrial and Commercial Bank of China’s ICBC Turkey unit, Vakifbank ​said on April 3.
The lender did not share any information on the cost of the loan facility.
In March 2017, Vakifbank received a 3-year, $250mn loan from ICBC Dubai. The latest loan suggests a rollover rate of 130%.
Vakifbank has a separate $1.1bn syndicated loan that requires rolling over this month.
The number of loan deals signed across the CEEMEA region fell by 58% y/y to a record quarterly low of 40 in Q1 while the total volume fell to $30bn from $51bn in Q1 2019, Global Capital reported on April 6.
The outlook for issuance is bleak, to the dismay of many lenders, according to the publication.
Refinancing risks for Turkish banks have increased given the change in investor sentiment as a result of the spread of the coronavirus, and lenders’ still high foreign debt, Fitch Ratings said on April 7 in a note on Turkish Banks' External Debt and FC Liquidity.
Fitch estimated that Turkish banks’ external debt service requirement over 12 months, in the event of a market shutdown, would be $35-40bn.
“It is unlikely that, even with very benign assumptions (such as global interest rates remaining close to zero for an extended period), debt can be assessed to be sustainable for many countries where financing needs will be large,” JPMorgan analysts including Nora Szentivanyi wrote in an analysis as quoted by Bloomberg in a story entitled “The Same Stimulus That Rich Countries Lean On Could Worsen Poor Economies”.
28​ TURKEY Country Report​ May 2020 ​ ​www.intellinews.com