IMF hands Turkey $10B, staggered payment aimed at halting financial crisis -

Xxxx Xxxxx Xxxxxx xxxxxxxx at xxxxxxxxxxx.xxx
Wed Dec 6 18:36:40 MST 2000



http://cnnfn.cnn.com/2000/12/06/emerging_markets/wires/turkey_wg/

ANKARA, Turkey (Reuters) - Turkish Prime Minister Bulent Ecevit said
Wednesday that agreement had been reached with the International
Monetary Fund on more than $10 billion in aid to help the country
weather a crisis in its banking sector and financial markets.

IMF and Turkish officials said $7.5 billion would come from a new
supplemental reserve facility (SRF) and another $2.9 billion from
Turkey's year-old $4 billion standby accord with the fund.

An SRF is a short-term facility charged at interest rates designed to
encourage quick repayment.

Turkey needs the fresh money to replenish central bank reserves drained
by a massive liquidity crisis sparked by fears of banking sector
instability.

Turkey also expects the World Bank to discuss and approve $1 billion in
financial sector reform loans before the end of this year, following
legislation aimed at paving the way for the privatization of four large
state banks.

The IMF deal follows an earlier announcement that Demirbank, the
country's ninth-largest bank in terms of assets as of mid-2000, would
join 10 troubled banks in a fund controlled by the Banking Supervisory
Board.

A criminal probe of some of those banks has all but destroyed
confidence in the financial sector, sending interbank rates soaring and
sparking a run on dollars that has bitten hard into the country's
currency reserves.


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Xxxx Xxxxx Xxxxxx
PhD Student
Department of Political Science
SUNY at Albany
Nelson A. Rockefeller College
135 Western Ave.; Milne 102
Albany, NY 12222



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