Oger creditors don’t have to reclassify debt: BDDK

Turkey’s banking regulator has assured creditors of Oger Telecom that a $4.75 billion syndicated loan will not go to default and they don’t have to re-classify it as “non-peforming”, its head said on Thursday, likely helping them avoid costly write-downs.

“We told banks not to classify the debt as non-performing. Either Treasury will acquire, or will sell it to Saudi Telecom or to others. The loan will not go into default,” Mehmet Ali Akben, the head of the BDDK banking regulator, told Reuters on the sidelines of an event in Istanbul.

The BDDK’s request marks an attempt to stem the fall-out from Dubaibased Oger’s Telecom’s widening debt problem. Oger, which owns 55 percent of fixed-line operator Turk Telekom , has struggled to repay the loan as a tumbling lira currency has driven up the cost of servicing its debt. Last month, Reuters reported Oger missed a third payment due on the loan.

Creditors include Turkey’s Akbank and Garanti , as well as Isbank, Turkey’s largest listed lender. Istanbul’s index of bank shares advanced 1.8 percent by 1105 GMT, outpacing a 0.79 percent gain in the BIST 100 index.

Akbank has $1.5 billion of exposure, while Garanti has $951 million and Isbank 1.9 billion lira ($491 million) worth of exposure to the loan, according to banks’ third-quarter financials. (RTRS)