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Chapter 7: Analysis of the Systemic Risk in the Turkish Banking Sector

    This chapter is a part of Mert Malkoç’s MSc studies under the supervision of İlkay Şendeniz-Yüncü at Middle East Technical University.

    https://doi.org/10.1142/9781800614321_0007Cited by:0 (Source: Crossref)
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    Abstract:

    In this chapter, we aim to see the effects of the foreign exchange (FX) debt level of Turkish banks on the riskiness of the banking sector between January 2008 and December 2021. We use two explanatory variables: the ratio of foreign loans to total assets and the ratio of Turkish Lira denominated deposits to total credits. Our results show that an increase in the ratio of foreign loans to total assets triggers an increase in the riskiness of the banking sector. However, the ratio of Turkish Lira-denominated deposits to total credits does not have a significant effect on the volatility measure.