Turkish banks' loan growth slightly decelerated to 30.1% y/y to TRY 1,026bn ( EUR 368bn ) in the week to November 22 from a 30.4% y/y loan growth in the week to November 15 , data of the baking industry regulator BDDK showed on Monday. Loans grew 1.01% w/w and 27.4% since the end of the 2012 as of November 22 , according to BDDK data. Consumer loans rose 28.2% y/y to TRY 243.7bn (25.6% ytd) while housing loans grew 29.3% y/y to TRY 108.8bn (26.5% ytd) and the growth in auto loans segment was 8% y/y to TRY 8.4bn as of November 22 . Banks' deposits reached TRY 963.8bn as of November 22 , representing a 21.2% y/y increase, BDDK data also showed. Last week, BDDK announced that Turkish banks' net income rose 11.6% y/y to TRY 21.7bn in January-October. Assets of the banking industry grew at 23.1% y/y and 19.4% since end-2012 to TRY 1,636bn while loans rose 29.4% y/y to 990.5bn. Non-performing loans (gross) recorded a 21.9% y/y rise and they increased 21.7% since end-2010 but NPL/total ratio was still a low of 2.9% as of end-October. The capital adequacy ratio of the sector fell to 15.8% from 16.9% in October 2012 and 17.9% in December 2012 , BDDK data also showed. Last month, the Central Bank said in the minutes of its latest monetary policy committee meeting that the cautious monetary policy stance, recently announced macroprudential measures, and weak capital flows have led to a notable tightening in financial conditions, which is expected to bring down the loan growth rates to more reasonable levels in the forthcoming period. Last month again, BDDK said it had prepared several new legislations on credit cards and loans to curb excessive usage of credit cards and loan growth. Maturities of consumer loans (excluding mortgages) and car loans will be limited to 36 months and 48 months, respectively. Moreover, loan to value in auto loans will be 70% for vehicles with a price up to TRY 50,000. These measures will probably discourage the use of car loans. Earlier last month, Ekrem Keskin , general secretary of Banking Association of Turkey (TBB), commented that loan growth in Turkish banking industry was expected to decelerate in the fourth quarter of this year due to signals from the Central Bank and the BDDK. FX deposits tend to rise recently due to depreciation in Turkish Lira, according to Keskin. Keskin also commented that recent measures taken by the Central Bank decreased the profit forecasts for Turkish banks. On a related note, Huseyin Aydin , head of the BDDK, commented that Turkish banks do not currently face any difficulties in foreign borrowing and any problem is not expected next year. US Fed's expected tapering of its stimulus programme creates some concerns over Turkish banking industry's foreign borrowing capacity.
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