Turkey’s Central Bank Raises Ratio for FX Reserve Requirements – Bloomberg.
Turkey’s central bank increased the foreign-currency reserve ratios required of banks and financing companies, after a month in which the lira was among the world’s worst-performing emerging-markets currencies.
The revision announced today is intended to make sure institutions can meet foreign-exchange liabilities. It would add approximately $3.2 billion to the central bank’s foreign currency reserves, the bank said in a statement on its website. The average reserve requirement ratio for foreign currency, now 11.7 percent, will rise to 12.8 percent, it said.
Turkish central bank Governor Erdem Basci warned Dec. 10 in Ankara that the bank would take measures against excessive short-term foreign currency borrowing by Turkish banks. The International Monetary Fund had urged Turkey to raise reserve requirements for foreign-currency liabilities in a report on Dec. 5, saying that reducing bank incentives to fund themselves in foreign currency would limit the risk of a balance-of-payments crisis.
