Friday, February 23, 2024

Türkiye’s Akbank plans to invest $200M in technology this year

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Turkish private lender Akbank will invest $200 million (TL 6.14 billion) in technology in 2024, its CEO Kaan Gür told a news conference on Tuesday.

According to a Reuters report, Gür noted that a budget of $600 million had been earmarked for technology investment in the next three years.

Changes to regulations in early February had eased cost pressures for banks and this will increase the appetite for loans somewhat, he said.

A portion of the loan requests that are being made had started to switch from Turkish lira to foreign currency, he said.

He added that a level had been reached in interest rates that will support conversions from FX-protected accounts (KKM) to Turkish lira ones.

Turkish central bank began rolling back the KKM scheme last August to boost the share of lira deposits in the banking system and has been announcing measures to dissuade companies and individuals from renewing these accounts.

The scheme, unveiled in late 2021, sought to keep dollarization at bay by encouraging people to keep their savings in lira through guarantees to compensate for losses from decline against hard currencies.

The Central Bank of Republic of Türkiye (CBRT) Governor Fatih Karahan reaffirmed last week the decline in the volume of KKM accounts observed in the past months, while he said the Turkish lira deposits were building up.

“In the last five months Turkish lira deposits increased by TL 2.4 trillion, while KKM volume decreased by TL 910 billion,” he said while presenting this year’s first inflation report.

The central bank orchestrated a shift toward more conventional policymaking last year and delivered a series of interest rate hikes that lifted the policy rate from 8.5% to the current 45%. The bank in its last policy meeting signaled the tightening cycle was complete.

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