Bank Regulation in Dollarized Economies: The Case of Turkey

Erick W. Rengifo, Emre Ozsoz, Mustapha A. Akinkunmi and Eduardo Court
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Erick W. Rengifo: Center for International Policy Studies, Economics Department, Fordham University, 441 E. Fordham Rd., Bronx, NY 10458, USA
Mustapha A. Akinkunmi: Brickfield Road Associates, 8 Onikoyi Street, Parkview Estate, Ikoyi, Lagos 101233 , Nigeria
Eduardo Court: Centrum Cat´olica, Daniel Aloma Robles 125, Los Alamos de Monterrico Surco, Lima 33, Peru

IJFS, 2013, vol. 1, issue 4, 1-17

Abstract: 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.

Keywords: dollarization; banking regulation; Turkish banking system (search for similar items in EconPapers)
JEL-codes: F2 F3 F41 F42 G1 G2 G3 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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