United Arab Emirates-based banks are increasing loans to their Turkish counterparts, filling a gap left by Western lenders that have retreated amid concerns over the country’s increasingly restrictive regulatory environment under President Recep Tayyip Erdogan.
Two of the Gulf state’s biggest lenders, Abu Dhabi Commercial Bank PJSC and Emirates NBD Bank PJSC, arranged 61% of all syndicated loans, which involve multiple lenders and one borrower, to Turkish banks in the first half of the year, compared with about 15% during the same period a year earlier, according to data compiled by Bloomberg.
By comparison, the likes of ING Groep BV, Deutsche Bank AG, Citigroup Inc. and Standard Chartered Bank Plc — which have lent to Turkish banks every year since 2021 — arranged 18% of loans, down from 33% a year ago.
Many international banks turned increasingly cautious on Turkey in the run-up to crucial elections in May that saw Erdogan reelected for another five-year term. Although the president is now setting the stage for a change in economic course, he has long championed an unorthodox economic policy based on ultra-low interest rates, which has come at a high cost in the form of depleted foreign-currency reserves, an inflationary spike, and an exodus of foreign capital.
No comments:
Post a Comment