Turkish banks: Pulling back from the brink (again)?
The main risk associated with the Istanbul election re-run was a marginal victory for either the AKP or CHP, which could have been challenged. That has not happened. Erkem Imamoglu of the CHP emerged the winner, taking 54% of the vote versus the 45% secured by Binali Yildirim, the AKP candidate. Here are our initial thoughts on these events, focused on Turkish banks:
President Erdogan has congratulated Imamoglu. For now, this should help address concerns about political interference, and is a marked change on statements made after the local elections in March. On the banks, we do not expect a change in support offered to Turkish lenders (which is sometimes seen as political/elections-driven) or to Turkey’s attempt to limit the impact of slower growth...
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