ECONOMY

In Brief

Mortgage loans in Turkey on the up ANKARA (Reuters) – Mortgage loans extended in Turkey have increased recently and this will help revive the recession-hit economy, the head of the banking watchdog BDDK said yesterday. The volume of housing loans rose to 41 billion lira ($27.3 billion) in early August from 39 billion at the end of last year. A combined 9 percentage points rate cut by the central bank helped banks to reduce their housing loans below 1 percent. Authorities don’t expect a US-style meltdown in Turkey due to strict terms applied for mortgages. Tevfik Bilgin said more than half of 850,000 households that received housing loans in Turkey benefited from the pre-crisis period’s low interest rates on such loans. «I do not expect a very big risk in housing loans as of today, despite the deep crisis in the world… Those who receive housing loans are very loyal to their debt,» Bilgin said. Turkey introduced strict standards on banks after its financial system nearly went bankrupt in a domestic crisis in 2001. Its banks posted hefty profits in the first six months. EFG Eurobank earnings slump 60 percent EFG Eurobank Ergasias SA, Greece’s second-biggest lender by assets, posted a 60 percent drop in second-quarter profit as it increased charges for potential bad loans. Net income fell to 88 million euros ($125.3 million) from 221 million euros in the same period a year earlier, the Athens-based bank said in an e-mailed statement yesterday. That compared with the 89-million-euro median estimate of eight analysts surveyed by Bloomberg News. (Bloomberg) Hellenic Bank Hellenic Bank Ltd, the third-biggest Cypriot lender, said first-half profit fell 96 percent on higher provisions for nonperforming loans and an increase in losses from Greek operations. Net profit fell to almost 2.1 million euros ($2.9 million) from 50.9 million euros a year earlier, the Nicosia-based bank said yesterday in a filing to the Cyprus bourse. Provisions for nonperforming loans more than doubled to 29.8 million euros from 14.8 million euros, primarily due to «the deterioration of the conditions in the financial environment,» according to the statement. Hellenic said pressure on interest rate margins contributed to a wider loss before tax in Greece of 34.4 million euros compared with 3.7 million euros a year earlier. The bank added that it has implemented management and structural changes in Greece to reverse losses. (Bloomberg) TV gains Teletypos SA, Greece’s biggest free-to-air television broadcaster, posted a second-quarter profit of 1 million euros, compared with 6.4 million a year earlier. Sales fell to 38.3 million euros from 51.3 million euros, according to a financial statement. (Bloomberg) Declining revenues Cyprus is facing a decline in all sources of government revenue as the economic downturn bites, hitting the island’s public finances, the finance minister said yesterday. Cyprus, which had posted surpluses for the past two years, had previously said it would try to keep its deficit below 3 percent of gross domestic product, the eurozone limit. But Charilaos Stavrakis said demand had dropped sharply in the first half of the year and tax revenues had fallen, making it difficult to predict if Cyprus could meet its deficit target. (Reuters)