Turkey scores 3 major foreign financing victories in a week

Turkey’s current account deficits are a perennial concern for investors, because their financing has been a major headache since 2018, when the country reverted to unorthodox policies aiming at maxing out on growth with negative real rates.  Turkey also mistreated foreign financial investors who left in droves, forcing Central Bank to finance external deficits from its FX reserves. The exodus by foreign financial investors and reluctance by global banks to   lend to Turkey explains the eternal depreciation of TL and sporadic  currency mayhem.


Thanks to orthodox policies implemented by economy czar Mehmet Simsek and CB governor Gaye Erkan, foreign financing is becoming easier to access, as attested by three major financing deals in the short span of a week:

AA: Turkey obtains major FX financing  to ease current account financing woes


World Bank’s private-sector arm IFC announced Friday a financing package of up to $530 million to support micro and smaller businesses in Türkiye’s earthquake-hit southern region.


International Finance Corporation (IFC) funding will be channeled through five private lenders of Türkiye, namely Akbank ($71 million), DenizBank ($119.5 million), QNB Finansbank ($109.5 million), Is Bankasi – ($150 million) and Yapi Kredi ($80 million).


Some $220 million of the fund was mobilized from international financial and development institutions.


Two powerful earthquakes hit 11 provinces in southern Türkiye on Feb. 6, causing extensive damage and killing and injuring tens of thousands of people.


The quake-hit region was home to more than 470,000 private enterprises, of which 99% are micro, small, and medium enterprises (MSMEs), the IFC said in a statement.


“The financing package aims to keep these vulnerable but otherwise viable enterprises afloat, as part of our strong commitment to support the economic recovery and foster sustainable and inclusive growth in Türkiye,” said Wiebke Schloemer, IFC director for Türkiye and Central Asia.


Türkiye is currently the IFC’s third-largest investment destination globally, with a committed portfolio of close to $4.9 billion as of November 2023.


Turkey’s Ziraat signs 1.75 bln euro loan deal with Deutsche Bank


State lender Ziraat Bank said on Friday it signed a 1.75 billion euro ($1.9 billion) loan deal with Deutsche Bank DBKGn.DE for up to five years, reflecting what it called the Turkish economy’s more positive trajectory.


Turkey’s largest lender by both assets and loans, Ziraat said the deal would help it continue to support exporters and other sectors that are a priority for economic development.


German lender Deutsche did not immediately comment.



İs Bank  scores 380mn USD

Türkiye İş Bankası signed a loan agreement totaling 67 million USD and 75 million Euros with the International Finance Corporation (IFC), PROPARCO, the private sector representative of the French Development Agency, and the Green for Growth Fund (GGF). The bank also completed a sustainability-related treasury financing transaction worth USD 230 million.


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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 www.paraanaliz.com and has contributed to the financial daily Referans and the liberal daily Radikal.