S&P lifts views on three Turkish banks to stable

S&P said it revised the outlook to stable from negative on three Turkish financial institutions, including Yapi ve Kredi Bankasi, Turkiye Garanti Bankasi (Garantibank) and Garantibank’s core subsidiary, Garanti Finansal Kiralama AS (Garanti Leasing).

The agency also said it affirmed the BB+ long-term counterparty credit ratings on all three entities and the B short-term ratings on Yapi Kredi and Garanti Leasing.

S&P also said it affirmed the trAA+ long-term and trA-1 short-term Turkey national scale ratings on Yapi Kredi.

The ratings and outlooks on all other rated Turkish financial institutions are unchanged.

The outlook revision follows a similar outlook revision on the Republic of Turkey due to the demonstrated resilience of the Turkish economy and a view that risks to the financing of Turkey’s still-large current account deficit and the roll-over of its external debt have moderated, the agency said.

Despite the outlook revision to stable, the agency said it still believes operating conditions remain challenging for Turkish banks as credit risks remain elevated and the banking system remains reliant on external funding.

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