The head of Turkey’s Banking Regulation and Supervision Agency (BDDK), Mehmet Ali Akben, has said Turkey is in need of a national credit rating agency and that steps for its establishment will be taken by the BDDK.
“We need a national credit rating agency that will be established by our bank. It is important for this agency to be in line with international standards and operate in an independent and objective way,” Akben said in remarks that appeared in the Dünya daily on Monday.
The BDDK chairman said the national credit agency is planned to be established in 2018.
Akben’s remarks came shortly after Moody’s ratings agency cut Turkey’s sovereign rating further, pushing it into junk territory, last week, citing a continued weakening of its economic and political institutions and the increased risks from its wide current account deficit.
Ankara dismissed the decision, saying it was not credible.
Moody’s downgraded Turkey by one notch to Ba2.
“The government appears still to be focused on short-term measures, to the detriment of effective monetary policy and of fundamental economic reform,” Moody’s said in a statement.
It said that set against a negative institutional backdrop, Turkey’s external position, debt and rollover needs had continued to deteriorate.
The downgrade was shrugged off by financial markets and dismissed by Turkey’s government, which has vaunted a strong economic recovery after a brief dip following a failed coup in 2016. GDP surged 11 percent in the third quarter.
“Today the markets had zero reaction to the Moody’s report. The Turkish economy continues its growth path with a strong structure and high quality in public administration,” Finance Minister Naci Ağbal was quoted as saying by the state-run Anadolu new agency. “The decision has no reputability at all.”
Moody’s had already cut Turkey’s rating to the sub-investment grade Ba1 in September 2016 following the attempted coup, which undermined investor sentiment towards what was once seen as one of the world’s most promising emerging markets.