S&P: Turkiye Garanti outlook negative

Standard & Poor's said it revised its outlook on Turkiye Garanti Bankasi AS to negative from stable and affirmed its BB- long-term counterparty credit rating.

The outlook revision follows a change in the outlook for the Republic of Turkey to negative, which the agency attributed to the increasingly fraught political and global environment that the country faces in the near term.

S&P said Turkish banks' performance and fundamentals are highly correlated with sovereign creditworthiness through, among other things, their significant holdings of government securities. The agency considers the Turkish operating environment to be risky, often subject to swings in foreign investor confidence and the associated movement of capital/funds.

However, unlike earlier in this decade, the agency said it expects Turkish banks to remain resilient to moderate political and economic volatility.

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