Step from TCMB to support Turkish lira deposits

The TCMB has taken steps to support the transition from Currency Protected Deposits to Turkish Lira deposits. Following the meeting of the TCMB management and bank general managers, which was first reported by Bloomberg HT, the lower limit of the interest rate applied to CCC accounts was reduced from 80 percent to 70 percent of the policy interest rate with the implementation instruction sent by the TCMB to banks. The Central Bank of the Republic of Turkey (TCMB) continued its steps to support the transition from Currency Protected Deposits (CCD) to Turkish Lira (TL) deposits and to reduce CCC accounts. The lower limit of the interest rate applied to CCC accounts was reduced from 80 percent to 70 percent of the policy interest rate with the implementation instruction sent by the TCMB to banks. The exchange rate difference amount to be paid by the TCMB at the end of the term will continue to be calculated based on the policy interest rate. In addition, it was announced that no payment will be made under the name of "additional income" for newly opened and renewed accounts. Thus, it is expected that the decrease in CCC accounts will accelerate and the share of TL deposits will increase. The changes will be effective as of July 22, 2024. Previously, the lower limit of the interest rate applied to KKM accounts corresponded to 40 percent, which is 80 percent of the policy interest rate of 50 percent. The 40 percent level was reduced to 35 percent with the new implementation instruction. Suggestions were made According to the information obtained by Bloomberg HT, which first announced the developments regarding the regulation, the TCMB management met with the incoming managers of the banks, and at the meeting, the TCMB management once again expressed its approach to exiting KKM. It was stated that the banks made suggestions regarding the fine tuning they thought should be done in this regard.