Bank Regulation in Dollarized Economies: The Case of Turkey
Regulators in emerging markets are increasingly curtailing the practice of foreigncurrency lending. In such a move Turkish regulatory authorities banned foreign currencylending to households in 2009. This paper examines the evolution of financial dollarization inTurkey in the 2002–2009 period by loo...
| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
| Published: |
MDPI AG
2013-11-01
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| Series: | International Journal of Financial Studies |
| Subjects: | |
| Online Access: | http://www.mdpi.com/2227-7072/1/4/137 |
| Summary: | Regulators in emerging markets are increasingly curtailing the practice of foreigncurrency lending. In such a move Turkish regulatory authorities banned foreign currencylending to households in 2009. This paper examines the evolution of financial dollarization inTurkey in the 2002–2009 period by looking the currency composition of loans and deposits inthe banking system and the macroeconomic developments. We find that the Turkish bankingsystem was unhedged against currency fluctuations and the regulators acted preemptively inbanning the practice. |
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| ISSN: | 2227-7072 |