Turkish banks seek freedom as Basel II hits capital ratios

Istanbullish

wolfgang-schilk

On July 1, capital ratios across the Turkish banking industry dropped an estimated 1.4 percentage points, as the country switched to the Basel II regulatory framework – a result of stricter risk-weights for certain assets, and the fact that Turkey’s banks must initially apply the standardised weights rigidly, with no freedom to adopt Basel II’s internal modelling approaches.

But this is something Turkey’s bank supervisor – the Bankacılık Düzenleme ve Denetleme Kurulu (BDDK) – expects to change.

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