The global crisis, which has left many people jobless and caused accumulating debts worldwide, is putting pressure on commercial loans in Turkey.
As many small and large companies close down due to declining orders and increase in costs amid the crisis, non-performing loans of Turkish banks have doubled. The rate of non-performing commercial and consumer loans and credit cards, which totaled 4.7 billion liras in September last year, rose by 65 percent to 7.9 billion liras in April this year. Non-performing commercial loans, which amounted to 1.3 billion liras in September 2008, rose to 2.5 billion liras as of April. Thus, total non-performing loan rate for commercial loans rose from 3.3 to 6.6 percent over September 2008. Over the period, consumer loans climbed from 1.4 billion liras to 2.4 billion liras. The rate of non-performing loans in consumer loans rose from 1.77 to 3.13 percent.
Bankers expect the trend to continue
The rise in consumer and commercial loans stems from the global crisis, according to bankers who expect that the rise will continue in the upcoming period. Unemployment is gradually increasing in Turkey, bankers said, adding that those that used consumer loans and have credit card debts are undergoing tough times.
As many companies face contraction or bankruptcy due to the deterioration of their financial structures, they are struggling to make their payments on time.
Since September 2008, when the crisis shook the world with the bankruptcy of U.S. investment banking giant Lehman Brothers, the top rise in non-performing loans has been seen in commercial loans with a rate of 81.35 percent.
In the seven months since last September, non-performing rate of credit cards has increased 50 percent. The rate of increase for consumer loans has been 73 percent. According to the latest data from the Central Bank, non-performing commercial loans, which stood at 1.3 billion liras in September, has now climbed to 2.3 billion liras. The overall commercial loans the banks open deteriorated from 39 billion liras to 36 billion liras in seven months. Despite the decline in commercial loans, the rate of non-performing loans increased. As of April, the rate of non-performing loans in commercial loans rose to 6.64 percent, reaching the highest level among all loans. This rate was 3.35 percent in September.
Following commercial loans, it was consumer loans that faced the highest rise in non-performing loan rate. Since September, non-performing loan rate of consumer loans have risen 73 percent. Total non-performing loan rate in consumer loans rose from 1.77 percent in September to 3.13 percent in April.
The liquidation rate of personal credit cards has risen 50 percent in seven months. In the first three months of the year, non-performing credit card loans rose 17 percent.
The number of those that are unable to pay their debts to banks rose 183 percent to 447,000 people last year. In the first two months of the year, 154,000 people could not pay their card debts. It was January that saw the highest rise of non-performing rate in commercial, consumer loans and credit cards. In January, the rise in non-performing rate was 13.96 percent in consumer loans, 13.51 percent in commercial loans and 10.43 percent in credit cards, compared to the previous month. The fact that the payments for commercial loans are made once in three months, as well as the problems in payments due to the financial problems of companies in December 2008 period has played a role in the high rate in commercial loans.