Bank of Turkey steps up pressure on Turkish banks asking to convince as many clients as possible to invest their money in a special deposit scheme emergency which was installed Anchor to protect the national currency. The reason for the deposit protection scheme adopted by Ankara at the end of 2021 amid one of many currency crises neighboring country. The purpose of this scheme was to stabilize the Turkish lira, which at the time lost 30% of its value in just one month. Under this scheme, deposits are committed to remain in Turkish lira while the Turkish state promises to reimburse any part of their value lost due to the devaluation of the country’s currency. Now Ankara is asking Turkish banks not to look for so-called “loopholes” in the law, so as not to create new demand for dollars and, in general, for hard currency.

So far, however, the scheme has proved ineffective as the Turks increased their foreign currency deposits, which reached $1.7 billion last month. In contrast, capital inflows in Turkish lira remained virtually unchanged over the same period. In a digital meeting with Turkish bank executives, the central bank raised the issue, stressing that deposits converted into Turkish lira as part of the currency protection program are not enough, sources speaking to Bloomberg on condition of anonymity said. She even repeated her request to Turkish banks to make the controversial scheme more attractive. The previous time he made similar requests, banks raised interest rates on Turkish lira deposits. After all, in the past, every time the central bank put forward such demands and put pressure on banks, it then introduced new mandatory rules, which were always aimed at artificially supporting the Turkish lira.

This has repeatedly provoked protests from high-ranking bank officials, who have emphasized that such ploys undermine the stability and profitability of their business. However, now the pressure is mounting as Turkey is in the pre-election period and the authorities are trying to prevent the weakening of the currency and limit the use of foreign currency in the banking system.