Concordat reversals

Concordat applications, which accelerated after the currency hit a historical high at TRY 7.24 to the dollar in August, along with rising interests, are estimated to approach 1,700. However, some retractions have been initiated due to the stabilization in the exchange rate. Reportedly, 56 companies which were forced to restructure their debts are in the process of withdrawing their applications while 7 have already retracted.

The process of structuring debts in concordat is overseen by three public banks. Speaking to daily DUNYA, one banker said: “There are 56 companies on the table and we think that they can continue their operations. The number for companies who retract from concordat may also increase. The main target here is that concordat limits the mobility of companies, and therefore creates risks of setbacks in their operations.”

Another banker stated that there are companies that never sat at the table with banks to consider the restructuring option. “They made their decisions without knowing that they had the restructuring option. They didn’t even go to the bank before they decided on the concordat. The panic is now over.”

Another banker we spoke to said that they are informing companies about the concordat and that they can help them to restructure their debts. Concordat commissioners may cause this problem, he added. “We make a payment plan for companies but commissioners abstain from signing anything. While the companies can be saved with restructuring, even simple problems cannot be solved because of the abstention of commissioners.”