Turkey's bank regulator ends ban on 3 banks

Turkey lifted a ban on several overseas banks from its currency market in a move to improve relations with foreign investors, the bank regulator said yesterday.

Last week, Turkey’s bank regulator imposed a trade ban on UBS, Citigroup and BNP Paribas because the government wanted to take protective measures as the Turkish lira tumbled to 7.269 against the dollar, its weakest ever, according to a BDDK letter sent to banks on Monday.

In the letter, Turkish banking regulator BDDK said the three foreign banks “have now fulfilled their obligations in a reasonable time frame”. Investigations into the banks are, however, ongoing, it added.

Turkish is struggling to explain its currency crisis to the public after the coronavirus pandemic. Yesterday, the Treasury and Finance Minister announced the country’s Economic Stability Shield package, launched to curb the economic fallout from coronavirus, has hit 240 billion Turkish liras ($35 billion) so far.

This is not the first time Turkey has faced a currency crisis. In 2019, after Turkey started military operations in Syria, the lira fell to its lowest level against the dollar after Donald Trump threatened to “obliterate” Turkey’s economy, heaping further pressure on the already struggling currency.

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