ISTANBUL (Reuters) – Turkey’s lira currency slipped yesterday, as local banks bought dollars to cover open foreign currency positions before year end. The lira slipped to 1,470,000 to the dollar on the central bank-brokered market from 1,436,000 on Friday, the last day of trade before a holiday that ended yesterday. The main share index ended the day 0.21 percent higher at 12,788.89 points, while yields on the busiest bonds crept up to 72.49 percent from 71.76 percent on Friday. Brokers said the dollar-buying stemmed from coupon payments in Turkish lira made to banks on foreign exchange-linked treasury bonds. Unless the banks exchange this money from coupons that are recorded as foreign exchange in their books, then their positions will stay open. Banks that don’t want that are going out to buy dollars, said one dealer. Traders said they anticipated some lira volatility as the year-end approaches and banks seek to close foreign exchange positions at the end of the reporting period. We may see a wide band before the end of the year. The lira may fall as low as 1,500,000 or it could test 1,400,000, said another banker. Traders saw little impact from a widely-expected IMF statement late on Friday that it was ready to sign a $10 billion addition to a $19-billion lending package for Turkey if Ankara pushes on with reforms and privatization. Stockbrokers said they were optimistic for the new deal, so long as Turkey’s fragile coalition government can unite behind the reforms the IMF wants. As long as no political problems emerge, it is possible that the index will see 14,000-15,000 in January, said Ozgul Peksert of Taib Investment. The three-year stand-by agreement constitutes a hope for the market, said Kemal Balta at Alan Investment. As a sign of its commitment to privatization, Turkey yesterday announced a timetable for the block sale of up to 74.75 percent of its eighth-largest bank, Vakifbank. Vakifbank said in a written statement the block sale involves A Group shares, representing 55 percent of the bank, and B Group shares amounting to 19.75 percent. Investors must bid for all the A shares and can offer to buy any or all of the B shares, meaning between 55 percent and 74.75 percent of the bank is up for sale. The present major shareholders in Vakifbank are Turkey’s General Directorate of Foundations, which monitors and runs charities and historic and religious monuments, and a retirement fund for the bank’s employees. The statement from the bank said interested investors would have to apply to a sale commission by February 11, 2002. The sale commission will select from the strategic investors those who will make final offers. It will announce the results of the initial screening on February 18, 2002 and continue the sale process with the selected strategic investors, it said. The selected bidders would sign a confidentiality agreement by March 4, 2002 and pay $10,000 for the terms of sale, it said. Turkey has been planning a privatization of Vakifbank since the mid-1990s, but like most such plans it has been delayed by government wrangling and domestic crises. Of Turkey’s large state banks, Vakifbank was hit the least hard by the financial crises in November last year and February. It has close links to religious and charitable foundations. September data from Turkey’s Banks Association put Vakifbank eighth in a sector of around 70 banks by assets. It has 315 branches nationwide and employs 8,219 staff.