Turkish banks under close scrutiny, have no toxic assets,watchdog says

Tevfik Bilgin told Reuters in a telephone interview on Thursday that Turkish banks had no toxic assets, such as the mortgage-related investments that have destabilized the western financial system.Â

 

He said Turkish banks were stronger than their European counterparts with higher capital adequacy and liquidity ratios.

Â

The global financial crisis, stemming from the collapse of the U.S housing market and a spiral of bad debt, is hurting Turkey but the country is far from the centre of the storm, he said.

 

The Turkish currency, bond and stocks, led by banks, suffered steep losses earlier this week as global risk aversion and fears of financial system meltdown spilled over into emerging markets. Â

 

"The global chaos is of course affecting Turkey and will continue to affect Turkey in the coming months...but we are far from the main centre of the tremors," Bilgin told Reuters in a telephone interview.

 

He said all Turkish banks had to look after the interests of depositors as well making profits. "All our bankers are in a way public servants. The public good has the priority. We are closely monitoring the behavior and statements of some of our banks very closely," Bilgin said but declined to name any banks.

 

Turkey's banking system's biggest shield is the absence of "bank-killer products", he said referring to the toxic assets that have sparked the collapse of some western banks.