Erdoğan says Turkish banks failed clients when they needed them most

Turkish President Recep Tayyip Erdoğan said many of the country’s non-government banks failed companies when they needed them most, refusing to lend money during an economic downturn.

The banks “shut off the taps” when they should have been opening them, causing some firms to downsize, Erdoğan said in a speech on Monday.

The government, however, has used state-run banks to support the companies, many of which operated healthily when discounting their financial troubles, Erdoğan said.

Erdoğan has called on Turkish banks to lend more to businesses and consumers after the economy reeled from a currency crisis that peaked in August last year. State-run lenders Halkbank, Ziraat Bank and Vakifbank have provided loans at below market rates and restructured the debts of consumers and businesses, helping the economy to emerge from a recession.

The Turkish president said the authorities are working on turning Istanbul into a regional financial centre. Those measures will be in place by 2022, he said.