Türkiye’s central bank has carved out an exemption from its cap on commercial lending growth so that companies can borrow from banks in Turkish lira to repay maturing bonds and other domestic debt securities, according to a report by Anadolu Agency carried by Bigpara on Monday morning.
The Central Bank of the Republic of Türkiye (TCMB) informed banks of the change in a letter. Under the new rule, lira loans extended to cover the principal repayments of domestically issued, lira-denominated debt securities of non-bank private sector companies will not count towards the loan growth limit. The exemption applies to securities that mature by the end of the year.
Why the growth cap matters
The TCMB limits how fast banks can expand their Turkish lira commercial loan books. In practice, a growth cap means banks can only increase business lending by a set amount over a given period, which can make it harder for companies to secure new bank credit even when they are considered good borrowers. The reports on Monday did not give the current size of the limit or the volume of loans the exemption could cover.
According to the central bank’s explanation, as reported by AA and Forbes Türkiye, the step is intended to support macro-financial stability and liquidity management. The bank said it wanted to prevent the growth limits from making it difficult for issuers with high credit quality to access bank funding when their debt comes due, and to make it easier for those companies to manage their liquidity.
What it means for companies and investors
Companies that have sold lira bonds or bills to domestic investors must repay the principal when those securities mature. The exemption means that a bank lending a company the money to make such a repayment does not have to use up its limited allowance for new commercial loans.
The measure comes after a turbulent period on Turkish markets. Borsa Istanbul recently posted its sixth consecutive weekly loss, while the investment fund industry has been shaken by a liquidation process and a wide-ranging investigation; parliament has already passed a fund liquidation law allowing interim payouts of up to 1 million lira. The TCMB did not link Monday’s decision to those developments, describing it in terms of liquidity management.
For foreign residents and investors holding Turkish lira bonds or funds that invest in corporate debt, the change could lower the risk that a creditworthy issuer struggles to repay simply because bank credit is rationed. It does not change the terms of any security. Anyone managing savings in Türkiye can find practical background in our guide to opening a bank account in Türkiye as a foreigner and our overview of the cost of living in Türkiye.
Sources
- TCMB’den yıl sonuna kadar geçerli yeni kredi düzenlemesi (Bigpara/AA)
- TCMB’den şirketlerin TL kredi kullanımına yeni istisna (Forbes Türkiye)
Photo: Nedret Binici / Unsplash License, via Unsplash
