Garanti BBVA: New BRSA restrictions put the brakes on consumer loans

Garanti BBVA General Manager  Mr Recep Baştuğ stated to Turkish financial broadcaster BloombergHT  there was a 10 percent decrease in loan volumes on the first day after the BRSA (Turkey’s banking regulator) decision to limit the maturities of individual loans. Baştuğ also supported the ending of clemency for the treatment of  non-performing loans implemented by the BRSA during the pandemic period.

Garanti BBVA General Manager Recep Baştuğ made a statement to Bloomberg HT at the Blue Breath Project press conference.

Baştuğ stated that the CBRT’s required reserve increase would not harm the FX liquidity of banks, and emphasized that the sector is healthy in terms of capital.

Sharing his plans for a sustainable green instrument, Baştuğ said, “We are at the very beginning of this business. We want to make all of our large loans and bonds from abroad within the framework of sustainability. In this way, we want to put ourselves into certain commitments and position both our customers and ourselves in healthier places in terms of the environment.”


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Required reserves will not have a significant impact on the balance sheet

Stating that the Central Bank’s reserve requirement move will not harm banks in terms of foreign exchange liquidity, Baştuğ said, “Over the years, the foreign currency balance sheet in the sector has come to a very different place. There are approximately 250 billion dollars of foreign currency deposits and 125 billion dollars of foreign currency loans. There is an abundance of foreign currency that banks cannot use now. Therefore, transferring some of these to  CBRT as required reserves will not affect banks’ liquidity.” said.



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Healthy decision to end it

Stating that the end of the non-performing loan forbearance implemented by the BRSA during the pandemic period on September 30 was a very appropriate decision.  Baştuğ said, “It was a macro-prudential  easing made under Covid conditions. I think it is a very healthy decision to end as of September.”


Banks have sufficient capital

Making evaluations about the capital adequacy of the sector, Baştuğ said, “The sector is quite healthy in terms of capital. The industry average is 17 percent and above. Considering the BRSA-required  minimum is 12%, I still think that the banking capital in Turkey is sufficient and that the banks can easily meet the loan growth needed for the upcoming quarters.”



Translation:  Cem Cetinguc


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Published By: Atilla Yeşilada

GlobalSource Partners’ Turkey Country Analyst Atilla Yesilada is the country’s leading political analyst and commentator. He is known throughout the finance and political science world for his thorough and outspoken coverage of Turkey’s political and financial developments. In addition to his extensive writing schedule, he is often called upon to provide his political expertise on major radio and television channels. Based in Istanbul, Atilla is co-founder of the information platform Istanbul Analytics and is one of GlobalSource’s local partners in Turkey. In addition to his consulting work and speaking engagements throughout the US, Europe and the Middle East, he writes regular columns for Turkey’s leading financial websites VATAN and and has contributed to the financial daily Referans and the liberal daily Radikal.