Ratings of Turkish Banks Lowered Following Sovereign Action

15 December 2021

Capital Intelligence Ratings (CI Ratings or CI) today announced that it has updated the ratings of 14 Turkey-based banks in light of the recent change in the outlook on the sovereign’s ‘B+’ Long-Term Foreign Currency Rating (LT FCR) to Negative (from Stable), and the adjustment in the Operating Environment Risk Anchor (OPERA) for the banking sector to ‘b-’ from ‘b’.

The LT FCRs and Bank Standalone Ratings (BSRs) of eight (Garanti, QNBF, DZB, Is Bankasi, Akbank, TEB, KTKB, Vakif) of the 14 banks have been affirmed, but the Outlooks for the ratings revised to Negative (from Stable), mirroring the sovereign action and indicating a likely downgrade in the ratings by one notch in the next 12 months.

For three of the banks (ATKB, Halk, YKB), the LT FCRs and BSRs have been lowered by one notch, driven by the change in OPERA. For one of these banks (Halk), the Outlook for the ratings remains Negative for institution-specific reasons, while for…