Moody’s, the global credit rating agency, has revised the Turkish banking system’s outlook from negative to stable.
After the May elections resulted in President Recep Tayyip Erdoğan’s victory, Moody’s noted that the Turkish government adopted conventional policies.
It also said efforts were undertaken to bolster the operational landscape of Turkish banks.
“The initial steps taken by the government to return to orthodox policies in policy-making following the election in May support the operational conditions of Turkish banks,” it said.
The credit rating agency emphasized the impact of elevated inflation and the devaluation of the Turkish lira on consumer purchasing power and debtors’ ability to meet their obligations.
Furthermore, the projection indicated that banks’ profitability, after reaching its peak in 2022, is anticipated to normalize and remain robust even amidst these various shifts, according to Moody’s.
The agency forecasts a 4.2-percent growth for the Turkish economy this year, with inflation projected to be at 51%.
“Despite the economic slowdown in the first half of this year due to the outlook in the European market, Türkiye’s strong exports and tourism sectors will continue to support the growth,” it said.
The statement added that the funding and liquidity positions of Turkish banks improved significantly, particularly in foreign currency, despite economic fluctuations.
By Breaking News Turkey with AA
