The Central Bank of the Republic of Turkiye (CBRT) announced that as a first step within the scope of its simplification policy, it has been decided to reduce the security establishment rate from 10% to 5%.
The CBRT’s communiqué on amending the Communiqué on the Establishment of Securities was published in the Official Gazette.
Accordingly, as a first step within the scope of the simplification policy, it was decided to reduce the security establishment rate from 10% to 5%.
Within the scope of the Communiqué, for banks whose securities establishment rate is below 57%, which is the lower of the shares calculated for real and legal persons, it will be increased by 7 points, and for banks with 70% and above, it will be reduced by 2 points.
Within the scope of the “Temporary application regarding the establishment of securities according to the conversion rate of the banks” added to the Communiqué, the following was noted:
“To be applied until the calculation date of September 29, 2023 (inclusive), in case of conversion below 10% according to the conversion rate from foreign currency deposit/participation fund to Turkish lira deposit/participation account to be calculated by the banks in accordance with the procedures and principles determined by the Central Bank, the securities amounting to twice the missing part will be blocked based on the accounting standards and registration scheme to which deposit and participation banks are subject. The facility period starts on the last Friday of the month following the calculation date and ends the day before the last Friday of the sixth month following the start of the facility. The provisions of this article do not apply to banks whose foreign currency deposit/participation fund size is below the amount to be determined by the Central Bank.”
The simplification will continue gradually
In the statement on the CBRT’s website, “It was stated in the Monetary Policy Committee’s decision dated June 22, 2023 that the existing micro and macroprudential framework will be simplified with a gradual approach based on impact analysis.”
In this context, as a first step, the application of securities establishment has been simplified in a way that will increase the functionality of market mechanisms and strengthen macro financial stability, and the simplification process will continue gradually in line with the principles announced by the Monetary Policy Committee.
Source: Trthaber / Prepared by Irem Yildiz