COVID-19 OUTBREAK MEASURES AND PRACTICES ADOPTED IN THE TURKISH FINANCIAL MARKETS

Abstract

Starting from March 2020, the measures taken by the Presidency, Central Bank of the Republic of Turkey (CBRT), Banking Regulation and Supervisory Agency (BRSA) and deposit banks as public banks and private banks against the possible effects of the outbreak have been announced in Turkey. Turkish financial institutions and regulators responded rapidly to Corona Virus (Covid-19) outbreak by providing liquidity solutions while protecting the health and safety of the customers. The economic package titled “Economic Stability Shield” announced by the Presidency on March 18, 2020 is the most important of the measures. On the other hand, the policy rate cut by the Central Bank is also major topic for the outbreak. For instance, Capital Markets Board of Turkey (CMB) banned short selling at the beginning of the outbreak. Deposit banks updated the ATM cash withdrawal and contactless payment limits and provided consumer loans with favorable conditions such as travel loans. Especially public banks announced many consumer loan opportunities towards tradesmen, low-income persons etc. Health insurance companies announced that they would pay Covid-19 expenses even though it is an exempt clause in the insurance contracts. Many private and public institutions continue to take economic measures against the Covid-19 outbreak, which affects the whole world and our country. The aim of this paper is to discuss the recent practices adopted by Turkish financial institutions and the measures issued by the regulatory institutions such as CBRT, BRSA and CMB. The effects of these all measures on the financial market are expected to be felt in the coming period. The measures aim to provide both the liquidity and maturity in financial markets and to prevent the spread of the outbreak.