The Central Bank of the Republic of Turkey (TCMB) has implemented a comprehensive update to reserve requirement ratios. These changes establish different rates for deposits and participation funds, as well as other liabilities.
The new rates for deposits and participation funds have been set as follows: The rate for demand deposits, notice deposits, and accounts with maturities of up to 1 month and up to 3 months has been set at 17%. The rate for accounts with maturities of up to 6 months and up to 1 year remained unchanged at 10%. The same rate applies to accounts with maturities of 1 year or longer. For accounts with maturities of up to 6 months that receive exchange rate or price protection support from the Central Bank, the rate has been set at 40%, while it is 22% for accounts with maturities of up to 1 year and longer. The rate for variable-interest accounts linked to the Consumer Price Index, Producer Price Index, and TLREF Index was announced as 10%.
While the reserve requirement ratio for borrower funds has been set at 0%, the rates for other liabilities vary. A rate of 8% will be applied to liabilities with maturities of up to 1 year, 5.5% for those with maturities of up to 3 years, and 3% for liabilities with maturities longer than 3 years. The rate for securities issued from liabilities with maturities longer than 1 year by development and investment banks has been set at 0%. Rates of 18%, 14%, and 12% will be applied to banks' foreign bank deposits and participation funds, foreign repo transactions, and loans obtained from abroad, depending on their maturity.
Additionally, the additional reserve requirement ratio applied to foreign currency deposits has been reduced from 4% to 2.5%. These changes appear set to have a significant impact on the banking sector.
News Source: 12punto
