A reverse wind can change both preferences and accounts in a short time.

Talip Aktaş from Ekonomim.com “KKMThe article titled “The least transformation was in public banks in Turkey”

In 2021, especially with September foreign currency against the inevitable rise in the exchange rate, in December currency protected deposit account (KKM) application was launched. The aim is to sell foreign currency, on the one hand, and foreign currency indexed TL account and foreign currency on the other. money The aim was to curb the rise in the foreign exchange rate, with the promise of a return equal to the exchange rate increase in case the deposits are converted into TL deposits.

Interest in FX-protected deposits increased by 3-3.5 percent on a monthly basis until August due to the moderate rise in foreign exchange and the parallel interest yield. In this period, close to 20 billion dollars of foreign currency deposits were dissolved. As of August, with the control of the foreign exchange increase and the decrease in the yield, the transitions to KKM also slowed down. After reaching a record level of 1 trillion 474.4 billion liras in the week of November 11, 2022, the volume of KKM started to decline as the maturity accounts started to settle in parallel with the stable exchange rates. Since the yield remained below the inflation, the savings from KKM were rapidly Exchange He headed for Istanbul.

The volume of KKM in banks decreased to 1 trillion 465.4 billion liras in the week of December 16. Since the beginning of 2022, when the practice started to become widespread, there was a decrease of 37.7 billion dollars in foreign currency deposit accounts of domestic residents, 3 billion dollars of which was due to the parity effect.

In the last one-year period, the bank groups in which foreign currency deposits decreased the most were privately owned deposit banks and foreign-owned deposit banks. There was a decrease of 13.4 billion dollars in foreign exchange deposits of both groups. 8.6 billion in foreign currency deposit participation banks dollar While there was a decrease, the group that experienced the least decrease was the state banks with 2.3 billion dollars. Proportionally, participation banks took the first place with a decrease of 31 percent. This group was followed by foreign deposit banks with 24.2 percent and private deposit banks with 18 percent. The proportional decrease in public banks remained at 2.4 percent.

An important point to be noted is that an important threshold has been restored in foreign currency deposits… The foreign exchange deposits of domestic residents, which exceeded the 200 billion dollar mark for the first time in the week of 6 March 2020 and hovered between 230-235 billion dollars for a long time, have increased over 2.5 years. After this period, it fell below the 200 billion dollar band again on the week of December 16, 2022.

However, it is clear that currency substitution or the easing in dollarization is not due to the stabilization of the TL or the strengthening of TL assets. On the contrary, due to the interest suppressed by the foreign currency, TL assets have reached historical low points in negative returns. Potential foreign exchange investors have a significant share in the fact that Borsa Istanbul, which is addressed as the “mandatory destination”, is far ahead of the world stock markets with a return of more than 100 percent in dollar terms, let alone in TL. A reverse wind can change both preferences and accounts in a short time.