What matters on Friday, August 5

The total net profit of banks jumped 401% from TRY 33.8bn to TRY 169.1bn in January-June, compared to the same period of the previous year, according to the Banking Regulation and Supervision Agency (BDDK). Considering the BDDK’s most recent steps, interest rates charged for loans, the margin of the weighted funding interest rate and developments involving FX-protected TRY deposit accounts, the profitability outlook for banks is positive, assuming the government does not move to break the current trend, according to Tera Yatirim Chief Economist Enver Erkan. “We expected loan pricing to be high in 2022 due to increasing geopolitical risks, the macroeconomic environment, private banks’ asset and liability management in terms of their high-risk profile, and inflation,” said Erkan. Tera Yatirim also thinks that the selective approach of the BDDK and the Central Bank in commercial loans may pose a downward risk to credit growth. “We estimate that total loan volume will grow by 49% and total deposit volume will grow by 43% in 2022,” Erkan added.

Turkey’s benchmark stock index Borsa Istanbul posted a new record closing of 2,723.67 points yesterday. Starting the day at 2,709.01 points, the BIST 100 index rose 39.21 points from Wednesday’s all-time high of 2,684.46. The total market value was TRY 2.2tr by market close, with a daily trading volume of over TRY 43.2 billion. Analysts stated that the global equity markets are on a positive course after the concerns over geopolitical risks were put on the back burner, listed companies received better financial statements than expected from investors and investors focused on macroeconomic data. They estimated that 2,600 points will be the support level and 2,750 points will be the resistance level for the BIST 100 index, in technical terms.

In the meantime, Borsa Istanbul has started to organize meetings with unlisted manufacturing companies across the country to inform them about the initial public offering process and capital markets, according to a statement from the institution. So far, representatives of the exchange have visited manufacturers in 14 provinces and are preparing to convene with companies in other cities. With these visits, Borsa Istanbul aims to present the role of capital markets in financing manufacturing investments and providing companies with long-term access to TRY.

Three ships carrying grain and foodstuffs will depart from Ukrainian ports today under the recent deal, according to National Defense Minister Hulusi Akar. “Thanks to the intensive work of the Joint Coordination Center, three ships are planned to sail tomorrow from Ukraine’s ports carrying grain shipments,” Akar said. Also, an empty ship is expected to arrive in Istanbul, where the Joint Coordination Center is located, for inspections before leaving for Ukraine, he added.

President Recep Tayyip Erdogan will pay a one-day working visit to Sochi today to meet with his Russian counterpart Vladimir Putin, according to a statement from the Communications Directorate. The leaders will evaluate bilateral relations, mainly focusing on the economy, trade and energy. They will also exchange views on potential steps to enhance bilateral cooperation. Before Erdogan’s visit, Putin held a video conference with permanent members of the Security Council, according to a statement from the Kremlin. The council exchanged views on Russian-Turkish relations, discussed the current situation in Nagorno-Karabakh and emphasized the necessity of immediately fulfilling all articles of the trilateral statement.


The Ministry of Treasury and Finance will release cash realization figures for July (5.30 p.m.).


>> Foreign Minister Mevlut Cavusoglu and UN chief Antonio Guterres spoke over the phone yesterday to discuss the latest developments related to the Ukraine grain deal. Their conversation came against the backdrop of Turkey’s announcement that three more grain ships are set to sail from Ukrainian ports today.

>> Wednesday, June 29, 2022, was slightly shorter than any other day by a mere 1.59 milliseconds, all due to a slight “wobble” of the Earth, according to scientists. An average day is 24 hours or 86,400 seconds, but timanddate.com reported that on June 29 the Earth completed one spin in a fraction of a second less.

>> The Consumer Price Index-based real effective exchange rate increased by 0.93 points to 54.01 points in July, compared to the previous month, according to the Central Bank

>> Residents’ FX deposit accounts rose by USD 1.94bn in the week ending on July 29, compared to the previous week, according to the parity-adjusted data from the Central Bank.

>> The Central Bank’s international net reserves surged by USD 2.4bn to USD 9.12bn in the week ending on July 29, compared to the previous week. The bank’s total reserves climbed by USD 2.9bn – from USD 98.32bn to USD 101.26bn – in this period.

>> Foreign investors’ net equity, government debt securities and corporate bond outflows from Turkey totaled USD 26.9m, USD 21.1m and USD 9.4m, respectively, in the week ending on July 29, according to the Central Bank.

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