Turkey to lure more local savings to banks

ISTANBUL- Hürriyet Daily News

Central Bank Gov Başçı speaks at the Gold and Jewelery Summit in Istanbul. AA photo

Turkey is planning ways to attract mattress savings to banks, in order to increase the country’s low domestic saving ratio, the governor of the Central Bank said yesterday, emphasizing that the bank was aiming to strengthen to its reserves by raising its gold reserve ratio.

“We are increasing the quality of the reserves by increasing our gold reserves,” said Erdem Başçı, speaking at the Gold and Jewelry Summit in Istanbul.

Başçı said the total gold reserve at the Turkish banks had risen to $8.67 billion by the end of last year. The Central Bank has nearly 206 tons of gold, worth almost $11 billion, and says that nearly 87.2 percent of this reserve comes from Turkey’s lenders for required reserve ratio.

Başçı also noted that the bank would maintain a policy of “controlled tightening” until the medium term goal of 5 percent inflation has been reached. He said the bank would take care not to damage the country’s banking as it seeks to restrain lending growth and slow inflation. Turkey’s consumer price inflation was 10.4 percent in February.

“The total volume of gold savings kept in the house is nearly $300 billion,” estimated Hakan Ateş, general manager of Denizbank, also speaking at the summit. “We should attract the people keeping gold at their houses,” said Vedat Akgiray, the chief of the Capital Markets Board.