Turkey: New BRSA Regulation for banks – service change for TRY
Following the press release of Banking Regulation and Supervisory Agency (“BRSA”) (the bank watchdog in Turkey) dated 5 May 2020, until the extraordinary conditions due to COVID-19 are removed, the total of daily money market placement, depot, repo and loans in TRY with the non-resident financial institutions is limited to 0.5% of the latest calculated capital of the bank. The purpose of this decision is to keep the maximum amount of funds within the banking system, to be used for the benefit of individuals and corporations impacted negatively by the COVID-19 crisis.
Clearstream Banking1 informs customers that according to this decision, we are required to minimise the overdraft credit lines of our customers.
As there is no direct reference to the overdrafts caused by fails of securities related transactions, we are in the process of clarifying this point with the authorities. Once we have their comments, we will update you accordingly.
Impact on customers
We strongly recommend that customers keep a buffer amount in their cash account in TRY considering your securities settlement, trading in BIST and cash transfer activity for the avoidance of possible risks of failed transactions.
If intraday extensions of credit are prohibited as a result of the regulation, Clearstream Banking will be limited to effecting customer settlement with the available funds on customer accounts.
Clearstream Banking will also confirm the impact of this regulation on the provision of FX Spot services.
Please forward this information to relevant teams in your organisation.
For further information, customers may contact Clearstream Banking Client Services or their Relationship Officer.
1. Clearstream Banking refers collectively to Clearstream Banking S.A., registered office at 42, avenue John F. Kennedy, L-1855 Luxembourg, and registered with the Luxembourg Trade and Companies Register under number B-9248, and Clearstream Banking AG (for Clearstream Banking AG customers using Creation Accounts), registered office at 61, Mergenthalerallee, 65760 Eschborn, Germany and registered in Register B of the Amtsgericht Frankfurt am Main, Germany under number HRB 7500.