Turkish Banks Praised for Strong Capital Structure by EBRD
The Turkish banking sector remains resilient with a strong capital base despite fluctuations in profitability, as stated by a senior official at the European Bank for Reconstruction and Development (EBRD). Francis Malige, Managing Director of Financial Institutions at the EBRD, expressed confidence in the sector’s ability to withstand challenges and highlighted its strong performance during a period of high inflation in Turkey.
The Central Bank of the Republic of Turkey (CBRT) has implemented policy-tightening measures to address issues such as inflation, foreign exchange reserves, and the current account deficit. Despite fluctuations, annual inflation has decreased from its peak, providing relief through monetary and fiscal tightening efforts.
Malige emphasized the importance of stable macroeconomic policies to mitigate challenges in the banking sector, such as high interest rates. He noted that Turkish banks have maintained healthy levels of profitability and strong capital and liquidity buffers.
EBRD has increased its investments in the Turkish banking and financial sector, focusing on promoting green and digital transformation, particularly among small and medium-sized enterprises (SMEs). The bank has launched a Green Economy program to encourage sustainability and digitalization in Turkish financial institutions.
In addition, EBRD has provided financing to businesses in Turkey’s southeastern region, which was affected by earthquakes. Efforts are ongoing to assess the needs of these businesses and provide continued support.
Overall, the collaboration between EBRD and Turkish lenders aims to strengthen the banking sector and promote sustainable economic growth in Turkey.
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Sofia Martins graduated from the Technical University of Madrid with a degree in Agronomy, focusing on plant nutrition and soil science. She has a deep interest in sustainable fertilizer management and works to develop eco-friendly solutions that optimize plant growth while minimizing nutrient runoff. Sofia is a dedicated researcher and has published several articles on sustainable plant nutrition practices.