CBRT Raises Credit Growth Limits, Introduces Interest Payments on Reserve Requirements
The Central Bank of the Republic of Türkiye (CBRT) increased credit growth limits and decided to pay interest on long-term non-deposit liabilities' reserve requirements, aiming to bolster macrofinancial stability and the monetary transmission mechanism.
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The Central Bank of the Republic of Türkiye (CBRT) announced revisions to its macroprudential framework, adjusting credit growth limits for banks and financing companies. The bank stated these measures are intended to support macrofinancial stability and the effectiveness of the monetary transmission mechanism.
Under the new regulations, the eight-week growth limit for consumer needs and vehicle loans has been raised from 3% to 3.5%. For Turkish lira loans extended to SMEs, the growth limit increased from 5% to 5.5%, while for non-SME businesses, the limit was adjusted from 2% to 2.5%.
Additionally, the CBRT decided to pay Turkish lira denominated interest or compensation on mandatory reserves held for banks' and financing companies' non-deposit liabilities. This applies to both Turkish lira and foreign currency liabilities with maturities exceeding one year.
The Central Bank emphasized that these changes were implemented to ensure the sustainability of macrofinancial stability and to enhance the efficiency of its monetary policy framework.