Banks see looser credit conditions in third quarter
ANKARA
Turkish banks expect a modest loosening of credit standards for business loans in the third quarter of 2025, except for foreign currency (FX) loans and loans extended to large enterprises, showed the Central Bank’s Bank Loans Tendency Survey.
This outlook follows a period of selective tightening and stability in lending practices during the second quarter.
According to the latest assessments, the second quarter of 2025 saw a relaxation in standards for certain retail loan categories, particularly those classified as general-purpose or consumer loans. However, no significant changes were reported in housing and auto loan standards, which remained largely stable.
Looking ahead, banks do not foresee any major shifts in credit standards across all types of retail loans in the third quarter.
This suggests a cautious approach to consumer lending, even as expectations for business credit conditions show signs of softening.
While domestic funding conditions improved significantly in the second quarter, external funding conditions tightened slightly, largely due to increased costs and more restrictive terms and regulations abroad.
However, looking ahead to the third quarter, banks anticipate a notable easing in both domestic and international funding conditions. This expected shift could enhance liquidity and support broader credit expansion across the financial sector.
