Turkey has amended classification rules for banks (including
foreign branches) which apply when classifying collectible credit
groups and other receivables. The changes allow conditions of
underlying agreements to be restructured more easily. Agreements
can now be changed, provided they continue to meet the relevant
credit group classification criteria. Credits and other receivables
can be restructured, without changing credit group
The Amending Regulation Regarding Regulation on Specification of
Credits and Other Receivables by Banks and Procedure and Principles
of Allowances which will be Reserved for These
("Amendment Regulation") was published
in Official Gazette number 29840 on 27 September 2016.
Notable changes introduced by the Amendment Regulation
The content of the "First
Group- Qualified Credits and Other Receivables" is not
changed. However, conditions can now be changed in agreements for
First Group credits or other receivables, provided the agreements
maintain the group conditions.
In general, credits and other
receivables which are likely to be collectable, but due to
deferrals or payment date being more than 30 days with a
dispensable reason, are classified as "Second
Group-Credits and Other Receivables Under Close
If a customer has multiple credits
from the same bank and any of them are classified in the Second
Group and all others in the First Group, all the customer's
credits will now be deemed to be in this Second Group. Provided
these credits sustain the conditions of their group, the conditions
of agreements for credits and other receivables can be
The Regulation is revoked which
outlines the method of reserving accounts specifically for consumer
credits other than housing credits. Under this change, housing
credit (such as mortgages) are no longer separated from regular
Please see this link for the full text of Amendment
Regulation (only available in Turkish).
Information first published in the MA | Gazette, a fortnightly legal
update newsletter produced by Moroğlu Arseven.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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