Why Turkey’s Deposits Now Expire Faster Than Milk

Turkey’s financial sector has undergone a dramatic restructuring of deposit and credit maturities since the start of its tight monetary policy cycle in June 2023. As macroprudential controls limited banks’ credit expansion, lenders increasingly relied on short-term funding, leading to a sharp concentration of Turkish lira (TL) deposits in ultra-short maturities. While credit maturities also shortened, the shift in deposits has been far more pronounced—reshaping banking behavior, interest-rate dynamics, and risk strategies across the system.

Over the last two years, the share of TL deposits with maturities of up to one month surged from 13.87% to 21.28%. At the same time, policy-rate-plus pricing for TL deposits became most visible in the 32-day maturity bucket, where banks concentrated their competition. Analysts note that restrictive regulations, particularly those limiting loan growth, reduced banks’ appetite for long-term deposits. With fewer channels to lend profitably, banks focused on meeting macroprudential targets through short-term deposit inflows, which offered flexibility without locking them into long-term interest obligations.

Rate Cuts Shake Deposits but Not Consumer Loans

The Central Bank of Turkey (CBRT) triggered renewed volatility in deposit pricing after cutting its policy rate by 100 basis points at the October Monetary Policy Committee (MPC) meeting. Although the CBRT reduced rates from 46% to 39.5% between July and October with a series of cuts, these moves did not translate into lower consumer loan rates, which remained elevated due to ongoing macroprudential constraints.

Because the CBRT refrained from easing regulations on TL lending, both TL credit and deposit rates stayed high. Even the October rate cut had only a limited impact—deposit rates softened modestly, while consumer loan pricing barely moved. As the EKONOMİ team’s review of bank websites shows, interest offered on deposits up to 32 days fell slightly, while longer maturities mostly slipped below the 39.5% policy rate.

Short Maturities Dominate as Banks Avoid Long-Term Risk

Banks continue to offer policy-rate-above yields for short maturities—particularly 32 days—while slashing rates for maturities beyond 46 or 92 days. This divergence reflects both liquidity management incentives and regulatory pressures. Every month, banks must meet the 60% share threshold for real-person TL deposits, pushing them to raise short-term rates sharply in the final week of each month.

According to the Banking Regulation and Supervision Agency (BDDK), the structure of deposits shifted dramatically:

1-month TL deposits:

• 21.3% share as of September 2025

• 15.3% in September 2024

• 13.9% in September 2023
  → Nearly a 7.4 percentage point increase in two years

1-3 month TL deposits:

• 48.5% in 2025

• 35.95% in 2024

• 31% in 2023
  → A remarkable 17.5 percentage point rise in two years

Meanwhile, longer maturities collapsed:

3–6 month deposits:
From 29% (2023) → 20.7% (2024) → 9.75% (2025)

6–12 month deposits:
Down to 2.24%

1+ year deposits:
Barely 0.96%

The numbers confirm that neither banks nor depositors are willing to take maturity risk, reinforcing a market dominated by short cycles and rapid repricing.

Credit Maturities Also Shrink, Creating Household Vulnerabilities

The CBRT’s Financial Stability Report highlights similar compression on the lending side. While fixed-rate commercial loans still average slightly above 700 days, this remains below the long-term average of 800+ days. In consumer lending, the adjustment has been sharper: the average maturity of personal loans dropped to 11.5 months, far below the historical 38-month benchmark.

Regulators warn that tighter maturities—combined with high borrowing costs—may increase credit risk among households whose income and debt timelines no longer align.

Why 32–46–92 Days Became the Critical Maturity Zones

Deposit pricing across common maturities reveals banks’ expectations for upcoming rate cuts:

32 days (shortest competitive tenor):

• From 44% in mid-October → down to approx. 42%

• “Welcome rates” still reach 46.5%

• Remains above the policy rate

46 days (sensitive to two MPC cycles):

• Peak rates: ~40.25%

• Most banks price below the policy rate

• Some banks offer rates as low as 26.25%

92 days (covers two rate-cut meetings):

• Lowest deposit rates across the board

• Mostly below 39.5%, sometimes near 30%

• Highest available rate: about 40%

• Sector-wide average decrease of ~1 point in the past month

Banks are pricing in continued CBRT easing into 2026, positioning longer-term deposits at significantly lower rates to avoid locking in high funding costs.

Consumer Loan Pricing Remains Stubbornly High

Despite falling deposit rates, consumer loan rates barely budged. One major private bank monitored by EKONOMİ maintained a 5.79% monthly rate from mid-October to mid-November. Some banks lowered their upper-range rates from 7.49% to 5.79%, but overall pricing stayed high, reflecting regulatory loan caps and risk-based constraints.

Even after the CBRT’s easing steps, consumer borrowing remains expensive and short-term, reinforcing the divide between deposit dynamics and credit affordability.