The average interest rate charged by banks for TRY commercial loans excluding corporate credit cards and credit deposit accounts (KMH) approached the same figure it was in June when the Treasury and Finance Ministry and the Banking Regulation and Supervision Agency (BDDK) announced successive macroprudential policies. The interest rate charged for TRY commercial loans, excluding corporate credit cards and KMH dropped by 131 basis points to 27.20% in the week ending on August 5, compared to the previous week. The figure stood at 24.91% in the week ending on June 9 when the first measures were announced. The interest rate charged for consumer loans meanwhile has reached 34.45% as of the week ending on August 5. Banking sources said the regulatory institutions sent a letter ordering that interest rates charged for commercial loans not exceed 22.0%. They also stated that banks have reduced the average by charging an interest rate of 27.0% for SMEs and up to 34.0% for non-SMEs.
Turkey’s benchmark stock index closed at 2,857.18 points yesterday, down by 0.25%, or 7.07 points, from the previous close. During the day, the index’s lowest value was 2,844.60, while its daily high was 2,885.34. The total market value of the BIST 100 was around TRY 2.3tr by close, with a daily trading volume of TRY 18.7bn. Although the U.S. inflation which remained below expectations has raised the risk appetite on equity markets, markets have fluctuated following the Federal Reserve official’s ‘hawkish’ statements, according to analysts. They also say that sector- and equity-based differentiation is continuing following the financial statements of companies on the BIST 100 index. They estimate that 2,820 points will be the support level and 2,900 points will be the resistance level for the BIST 100 index, in technical terms.
The cost burden of FX-protected TRY deposit accounts (KKM) on the central government budget hit an all-time high of TRY 23.4bn in July, according to the Treasury and Finance Ministry. While the figure stood at TRY 11.7bn in March, TRY 4.5bn in April, TRY 4.8bn in May and TRY 16.2bn in June, the total cost burden has reached TRY 60.6bn as of July. The Treasury only shoulders the cost burden of the shift from TRY deposit accounts to KKM and the cost, which is undertaken by the Central Bank for the shift from FX to KKM, hasn’t been included in the data. As companies, whose shift to KKM accelerated as of August, adopt the accounts, the cost of KKM to the Treasury is expected to be higher in the August central government budget figures. Our Eco-Analysis Columnist and daily DUNYA Columnist Alaattin Aktas stated in his latest article that TRY 829 has been taken from everyone over the past five months while TRY 70.8bn, which is the total amount of a 5-month cost burden of TRY 60.6bn and TRY 10.2bn FX profit-based tax exemption implemented for legal persons for the shift from an FX deposit account to KKM, is divided among 85.4 million people, the estimated population of Turkey for 2022.
DAILY AGENDA
House sales dropped by 12.9% to 93,902 units in July, compared to the same month last year, according to the Turkish Statistical Institute (TurkStat).
Private sector’s total outstanding loans received abroad declined by USD 7.6bn to USD 161.4bn in June, compared to the end of 2021, according to the Central Bank.
The Central Bank will release the Residential Property Price Index for June (2.30 p.m.).
Meanwhile…
>> Those, who run second-hand land vehicle business won’t be able to directly or indirectly sell or market passenger cars or land vehicles before July 1, 2023, unless six months have passed from the first registration date and the mileage indicator has exceeded 6,000 kilometers, according to a new regulation published in the Official Gazette.
>> The Turkish Grain Board (TMO) said unshelled hazelnut purchases will start by August 22 at 11 locations at the first stage. The sales points may increase to 50 in line with the harvest.
>> The upper limit for the Credit Guarantee Fund (KGF) was raised from TRY 500bn to TRY1tr, according to a Presidential Decree published in the Official Gazette.
>> The central government budget posted a TRY 64.01bn deficit in July, according to the Ministry of Treasury and Finance.
>> The total amount in FX-protected TRY deposit accounts has reached TRY 1.17tr as of August 5.
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Banks’ profits exceeded 400% in the first half of 2022 while manufacturers’ difficulty in accessing finance increased. But are the banks profitable? Daily DUNYA Editorial Coordinator and Columnist Talip Aktas addresses this question.
