A new report released by Fitch Ratings has stated that Turkish Banks credit profiles are strong and robust in 2011 despite some market and regulatory challenges.
The report shows that Fitch views the medium term outlook of Turkish banks as favourable. However the near term outlook for the Turkish economy is set at uncertain as a precautionary measure due to the current economic climate surrounding Europe.
The report showed that fast Turkish credit growth has created risk management challenges for the nation and led to a moderation of capital and funding ratios. However Fitch dismissed this in their report, saying that underwriting standards in Turkey have remained generally strong and healthy while leverage in the system is also contained.
Turkey’s credit growth has begun to slow down in third quarter of this year due to regulatory measures and the weaker outlook of the world. This has reduced the potential for a dangerous rapid build-up of risk in the near term for Turkey, ensuring a safer outlook for the Turkish economy compared with other nations.
Turkish banks swift action and reputation for tight control of their finances has led to an all-round solid performance in the Fitch Ratings.