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Turkish Banks Get Some Relief as Foreign-Borrowing Costs Drop

  • Lenders are refinancing loans at discounts of as much as 10%
  • Number of banks are all tapping syndicated loans for funding
Updated on

It’s getting cheaper for Turkish banks to raise foreign debt as the economy shows signs of avoiding a 2019 contraction and the government takes steps to deal with bad loans.

The lira’s recovery from its crash late last year is also helping some lenders cut interest rates on syndicated loans by as much as 10%. That’s even though the average credit rating of the banks are two notches lower at Moody’s Investors Service than a year ago, and three places down from where they were at the beginning of 2018 at Fitch Ratings and S&P Global Ratings.