International rating Agency Standard & Poor’s (s&P) downgraded the ratings of five Turkish banks by one notch from BB+ to BB. The Outlook on the ratings is negative. The relevant information contains in materials of the Agency.
Actions S&P touched Isbank, Garanti Finansal Kiralama, YapiKredi, Turkiye Garanti Bankasi and VakifBank. They explained that the downgrade of the credit institutions followed the deterioration in the rating of Turkey. Analysts at Standard & Poor’s believes that the failed coup attempt in the country worsens the investment climate and growth potential.
There is a risk that Turkish banks will experience difficulties in servicing their external debt. The experts of Agency specify that these credit institutions are heavily dependent on external financing.
July 20, S&P downgraded the sovereign rating of Turkey from BB+ to BB. In response, the adviser of the President of Turkey Cemil Ertem said that the decision of the international rating agencies due to political motives. This initiative is “a continuation of attempts of a coup d’etat,” said Ertem.
July 19, Moody’s placed the credit rating of Turkey, which is at the level of Baa3, on review for downgrade. According to experts Moody’s, despite the failure of the uprising, the very fact of attempt of violent change of power is a symptom of serious political problems, which leads to increase of credit risks.
The attempted coup was made in Turkey on July 15. The rebels took to the streets of Istanbul and Ankara heavy military equipment and a number of army units, however, loyal to President Recep Tayyip Erdogan forces and intelligence agencies failed to suppress the rebellion.
