Moody's Investors Service downgraded 18 banks and two more companies from Turkey's financial sector. This action concludes the review for downgrade initiated on 7 June 2018 on 17 banks and two finance companies in Turkey.
The decision published today also affected Nurol Investment Bank Inc., which saw its rating drop by one level despite a previously stable outlook.
Denizbank AS, Odea Bank AS, Turkiye Is Bankasi AS and Turkiye Sinai Kalkinma Bankasi AS were all placed two grades lower, together with both entities from the other group.
At the same time, the remaining 14 lenders were cut by one level. They include TC Ziraat Bankasi, Turkiye Garanti Bankasi AS (TEB), Turk Ekonomi Bankasi AS, Akbank TAS, Yapi ve Kredi Bankasi AS, Turkiye Halk Bankasi AS (Halkbank), ING Bank AS and HSBC Bank AS.
"The downgrades primarily reflect a substantial increase in the risk of a downside scenario, where a further negative shift in investor sentiment could lead to a curtailing of wholesale funding... Moody's also recognizes the potential risk of a parallel deterioration in confidence in US dollar domestic deposits," the credit appraiser said and expressed expectations of further worsening in the operating environment in the troubled economy.
