Macro View
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Is Productivity in Decline?

In the years since the global financial crisis many economies have face slower expansions in some key components of potential output growth, and following that, lower potential growth has emerging as a new reality for the global economy. In advanced economies it has been driven…

Sector Reports
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Do Turkish Banks Add Economic Value?

Time and time again I have been directing sharp criticism for the relatively poor financial performance, and more importantly, for the industry’s lack of focus on low profitability. In September, return on equity, or ROE, for the whole industry, came down to a level that…

Sector Reports
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Prospects of A Liquidity Shortfall

In a country where average maturity of deposits is very short, liquidity risk management for financial instructions is of paramount importance. Most particularly, in Turkey, a country seeking high growth where the consumption is the engine of the economy, the liquidity balance become even more…

Macro View
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Core Inflation Heats Up

As expected yearly inflation fell in October as temporarily weaker food and energy prices more than offset the impact of the foreign exchange pass through (1.5% m/m, 7.6% y/y). The figures seemed to be slightly above the estimates. The upward surprise was on the back…

Equities
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Turkish Stocks: Banks v Industrials

One of the key market themes that marked this year has been the bank stocks trading with low multiples and the advancement in the industrials. Time and time again we uttered that the golden age of Turkish banking is over (see here and here) which…

Macro View
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Consumer Confidence Tumbles

Despite the ongoing still-decent GDP growth, the economic outlook of Turkey is not in brilliant shape. Following a robust start to 2015 for the economy, the current focus of consumers in view of economics developments in predominantly on general domestic conditions and clearly there are…

Sector Reports
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Alarming Rise in Energy Loans

Turkish banks have been lending to energy industry firms at a rapid clip. The share of the industry in total corporate loans rose from 3% in 2007 to 7.4% in 2H15, and this came amid a lending boom that had been a major concern about…

Macro View
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Profound Shift In Liquidity Risk

On Sep 15 an article appeared on Bloomberg that drew a gloomy picture for the brokerage services industry in Turkey. Some important highlights from the article are as follow: About one third of brokerages posted losses in the first quarter. Austria-based Erste and Kuwait-based Burgan…

Macro View
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June Jobs Report: Not Encouraging

Turkey’s unemployment rate rose to 9.6% of the labor force in June from 9.3% a month earlier as the non-agricultural employment rate stood at 11.7%. That said seasonally adjusted data suggested a rise in the number of people without a job increasing the unemployment rate…

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