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CEE & Turkey

13 Jul 2017   CEE & Turkey, Russia & CIS

Russia, CIS, Europe & Turkey Credit Markets Brief: 20 June - 13 July

Russian Eurobonds see strong demand despite additional US sanctions looming – Russia’s VTB agrees new loan to Croatia’s struggling food producer Agrokor – Gazprom issues US$500mn Eurobond – Russia’s Yugra bank is latest to go into administration – Ukraine expects delays on latest IMF tranche – State-owned Ukrainian Railways to issue UAH2bn bond - Azerbaijan's FX reserves rose by US$3bn - Turkey's Is Bankasi issues US$500mn bond

Turkish Growth: Is 5% Too Good to be True?

Turkish policymakers finally got some breathing room earlier this month when official data unveiled that Turkey’s economy had grown at 5% in the first quarter of 2017, beating market consensus by more than 1% while raising suspicion among economists

Political influence Threatens Turkey’s Ability to Control Inflation

As Turkey’s inflation rate surges to levels not seen since the 2008 financial crisis, it will be up to the Central Bank not only to control rising prices, but to break free from political interference.

Turkey’s Sovereign Wealth Fund Promises Better Governance, More Synergies to Bolster Returns

Details about Turkiye Varlik Fonu, Turkiye Wealth Fund tasked with generating over US$200bn in economic activity in the years to come, have been scarce since the fund was put in place last year. We speak with Mehmet Bostan, the well-known banker assigned with setting up and managing the fund, about how TVF is positioning itself to jolt the economy back to life and make Turkish companies more influential on the world stage.

Czech, Please? Speculators Hesitate as De-Capped Koruna Rally Falters

Strong signalling and early exit from the currency cap allowed the Czech Central Bank to avoid FX volatility, but currency traders were left in limbo as a Swiss-style post-flotation appreciation failed to materialise.

Referendum Result Puts Reform in Focus in Turkey

With one of the most controversial referendums in Turkish history having come to pass and growth on the rebound, analysts are now focusing their attention on whether AKP will succeed in refocusing on the reform agenda that ushered in the party’s initial success in 2002.

Turkey Represents a Big and Difficult Call for Emerging Market Investors This Year

There are good reasons to be cautious around Turkey this year, given well-known concerns over security and domestic political stability exacerbated by polarisation as we head towards the scheduled referendum over the introduction of an Executive Presidency. Turkey’s well known Achilles heel, large external financing requirements (around US$200bn, double the country’s foreign exchange reserves), and associated concerns over rollover risks on around US$160bn in short-term debt liabilities, has not been helped by the recent sharp exchange rate drops or less-than-orthodox monetary policies from the CBRT, which are considered “opaque” by many.

CASE STUDY: Tofas Drives International Appetite for €200mn ECA-Backed Facility

Tofas Turk Otomobil Fabrikasi A.S. secured a €200mn ECA-back term loan facility against a backdrop of increasing emerging market volatility. The deal was critical for the development of the country’s automotive industry, and helped Tofas Turk finance the development of two new car models.

CASE STUDY: IC Construction Group Lays Groundwork for IPO with Project Finance Facility

IC İçtaş Enerji Yatırım Holding A.Ş. was able to utilise its close relationship with banks to rapidly close one of Turkey’s largest project finance loans of the year. The size of the project and the acquisition of two new HEPPs from the privatisation authority also managed to attract a larger group of lenders to the transaction.

CASE STUDY: Crescent Capital Cleans Up with Well-Structured Acquisition Finance Facility

Crescent Capital was able to secure a unique project finance facility within the Turkish markets with a mezzanine facility structured as a Murabaha commodity purchase tranche, achieving a long tenor, an uncommon feature in this market, and structured as a true non-recourse facility.


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