Analysts warn of crisis risk for Turkey

Bloomberg

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The chance of an emerging-market financial crisis during the next 30 days climbed to 3.17 percent as of last month, from 2.42 percent in November, CreditSights analysts Joey Bortfeld and Jim Baltz wrote in a research note dated Wednesday.

India’s probability was 7.92 percent in December, while Turkey’s were 8.16 percent. Pakistan and Hungary topped the list of 25 developing countries with odds of 10.2 percent and 9.3 percent, respectively, based on a scoring model that analyzes banks’ overseas liabilities relative to deposits, currency reserves, foreign trade and equity-market volatility.

Characteristics of a financial crisis include government defaults, currency runs, banking system failures and International Monetary Fund intervention, CreditSights said. The analysis "is currently indicating a horrible start to 2009 following a horrible 2008," Bortfeld and Baltz wrote.