State lenders ease accessing finance, postpone loans

State lenders ease accessing finance, postpone loans

State lenders ease accessing finance, postpone loans

Turkish state lenders - Ziraat, VakıfBank, and Halkbank - announced packages for supporting economic activities in Turkey, following the recommendations of the Turkish Banking Association (TBB) to tackle the effects of the COVID-19 pandemic.

Three banks said in separate statements that they will postpone loans of individuals and firms and also provide flexibility to their customers.

Banks will provide long-term postponements of up to 12 months for some sectors which were affected by the outbreak the most, particularly tourism and public transportation.

Ziraat and Halkbank will open a special credit line for the next three months to continue paying personnel salaries on the condition that these firms do not drop the number of employed staff.

Firms will be given extra credit limit for easing their check payments and operation costs.

On March 18, the TBB recommended easing credit access and providing flexibility to all lenders for their customers “who need additional loans due to a provisional disruption in their revenues-expenses balance, have difficulty in the timely repayment of their liabilities, have the intention to repay their debt on time.”

Turkish Finance and Treasury Minister Berat Albayrak said state lenders “fulfill their responsibilities as part of the measures to reduce the effects of the pandemic on the economy, prevent falls in employment, and keep the labor market alive.”

“We will keep taking the necessary steps in this dynamic period. We will weather the hardship hand in hand as the state, the nation and the business world. I believe that private banks will follow these valuable steps taken by our public banks,” he added.

Işbank, Turkey’s largest private lender, also unveiled a package to revive business activity on March 23.

Firms, particularly those operating in the sectors of tourism, logistics and retail, will be granted expanded lending limits, according to İşbank’s statement. Besides, their loan repayments will be postponed to the end of June.

All corporate customers of İşbank will have access to extra loan limits for salary payments to their employees.

Money transfers via İşbank’s digital platforms will be free of charge until the end of April.

Personal account holders of Işbank will be granted increased credit card limits for healthcare product and food shopping.

Consumer loan, credit card and overdraft repayments of personal account customers of the private bank will be postponed for three months on demand.

Turkey has unveiled a relief package worth 100 billion Turkish Liras ($15.4 billion) to limit the economic fallout from coronavirus.

President Recep Tayyip Erdoğan announced the package, which includes debt payment delays and tax cuts across various sectors, on March 18.

The relief package will provide $8-9 billion liquidity to the markets in the next three months, Albayrak said on March 19.

The finance minister said he had “no concerns” about Turkey’s ability to meet its economic growth of 5 percent, budget and inflation targets for 2020 despite expectations of a potentially severe global recession.