BDDK Abolished Active Ratio Implementation

BDDK Abolished Active Ratio Implementation BDDK abolished the active ratio implementation. The asset ratio will be abolished as of December 31st. Banking Regulation and Supervision Agency (BDDK) decided to abolish the asset ratio application. In the statement made by the BDDK, it was noted that it was decided to terminate the calculation of the asset ratio and to abolish all Board Decisions regarding this as of December 31. With the said decision, while TL started to gain against the dollar, the banking index gained approximately 3 percent.   Applied Since May The active ratio, which was decided to be implemented in April, was put into practice in May. Depending on the normalization efforts in the previous period, the active ratio was revised in August, September and October. With this regulation, it was aimed to increase the credit given by the banks. Banks also requested a revision from the authorized units regarding their asset ratio. In the period when the coronavirus epidemic broke out, loan growth was at the level of 134 percent in May, with the effect of loan programs offered by public banks. After the normalization steps were taken, a normalization trend was observed in loan growth. While there was a retreat in deposit interest due to the effect of the asset ratio, the average interest rates on time deposits up to 1 month fell below 7 percent in June. In the following period, with the normalization steps taken, the deposit interest rates, which started to increase again, recorded double digits. Last week, Minister of Treasury and Finance Lütfi Elvan made the following statements: “We consider it an important issue to reduce intermediation costs and to establish pricing in credit and deposit markets within the free market mechanism.”