Turkish banking gets a World Bank boost
ANKARA (Reuters) – The World Bank announced yesterday it has submitted for board approval in April a $1.35 billion loan to help Turkey overhaul its troubled banking system and reform the public sector. «The loan will be provided in three tranches of $450 million each based on the completion of agreed actions,» the World Bank mission in Turkey said in a statement. Projects The loan will back the reform of state banks and strengthening bank regulations, the statement said. «In the public sector it supports rationalization of public expenditure and investment programs, implementation of governance and an anti-corruption program,» it said. The money will also go toward improving the management of public debt and reforming employment in state-run enterprises. The Turkish Treasury also issued a statement yesterday, saying the government and World Bank board were ready to sign the loan agreement. Ankara has issued billions of dollars of debt to rehabilitate its ailing banks at the center of a financial crisis that resulted in the country’s worst recession in decades. Its domestic debt reached 118,045 trillion lira (around $87 billion) at the end of February. The International Monetary Fund (IMF) has given or promised a total $31 billion in loans to help Turkey overcome the crisis. The World Bank said a team will arrive the first week of April to work on support for the manufacturing sector, financing exporters and corporate restructuring. Turkey has introduced a number of reforms to win World Bank and IMF monies. It has promised to privatize state industries and overhaul its banking sector.
