The IMF Country Reports Series covers economic and financial developments and trends in member countries. Each report, prepared by a staff team after discussions with officials of the country, is published at the option of the member.
This Financial System Stability Assessment on Turkey discusses macroeconomic development and trend in the financial system. The financial system does not appear to face major immediate threats, but vulnerabilities remain. Turkey remains dependent on capital inflows and thus on international investor sentiment. Large holdings of public sector debt by banks makes their solvency, profitability, and liquidity highly sensitive to adverse market revaluation of these securities in the event of external shocks or/and internal political uncertainties.