Turkey

Turkish president Recep Tayyip Erdogan has fired Turkish central bank governor Murat Cetinkaya. The development has, according to capital market participants, shredded more of Turkey’s credibility and caused last week’s dollar benchmark to slump below re-offer.

In this round-up, Chinese securities regulators allow their Hong Kong counterpart to access audit papers of Hong Kong-listed mainland companies, Chinese premier Li Keqiang vowed to lift the 51% foreign ownership cap on Chinese financial firms sooner than planned, and free-trade zones (FTZs) receive more autonomy in trying out new policies.

Turkey returned to the market on Tuesday, raising $2.25bn of five year dollar paper with a slim new issue premium. The deal was timed to take advantage of a tremendous rally in Turkish asset prices, but not all investors are convinced.

Turkey announced a five year dollar Global benchmark on Tuesday, returning to the market for the first time since March and making the most of the rally in Turkish assets.

Investors gained confidence from the defeat of Turkey's ruling AK Party in the rerun of the Istanbul municipal elections on Sunday. Asset prices have rallied, improving conditions for Turkish borrowers.

Banks pride themselves on analysing and pricing credit. But are they really just slaves to the rating agencies?

Turkey’s banks, renowned for their resilience as borrowers to market shocks, risk paying wider margins when they refinance debt later this year, according to some bankers. The dismal outlook follows Moody’s recent downgrade of Turkey’s sovereign debt and 18 of its banks.

Moody’s took the axe to Turkey’s credit rating after market close on Friday, cutting the sovereign’s rating from Ba3 to B1 in a move that has raised hackles from some international investors.

BlackRock, KKR loan for ADNOC 'close to signing' — Uralkali signs as lenders prepare for EuroChem —Redexis joins Spanish trend to ESG borrowing — French Ipsen debuts in US PP market — Turkish banks close refi season, with wider secondaries

Turkish banks have completed the first refi season of the year and, despite ongoing geopolitical issues including concerns about Turkey's purchase of S400 missiles from Russia, spreads in the secondary loan market have stabilised at slightly wider levels.

Türkiye İş Bankası has closed its first semi-annual refi for this year, as the refinancing season for Turkish banks comes to an end.

Loan bankers are coming to the painful realisation that emerging markets borrowers will be increasingly drawn to the bond market this year. Conditions there are becoming ever more attractive, perpetuating a decline in global loan volumes. But those companies abandoning loans for bonds should bear in mind the advantages of the loans market, not least its resilience.