Capital needs of Turkey’s state-run banks discussed at summit

Turkish state-run banks’ capital needs were among the issues discussed at a meeting between President Recep Tayyip Erdoğan, his finance minister and top bankers on Monday, the Dünya newspaper reported.

The banks require more capital to implement the government’s demands for more lending, Dünya said on Tuesday. The banks need 60-70 billion liras ($4.2 billion-$4.9 billion) and the amount could be as high as 100 billion liras ($7.0bn), it said citing unidentified people close to the matter.

Turkey’s state-run banks received 21 billion liras ($3.2bn) from the country’s sovereign wealth fund to help create a lending pool of 160 billion liras ($24.6bn) during the outbreak of the COVID-19 pandemic last year, the newspaper said.

Monday’s meeting also focused on interest rates charged by non-government banks on business loans, which are approaching 20 percent, Dünya said. State-run banks are offering a rate of 15.75 percent, it said.