In the scope of Article 45 of the Central Bank Law, rediscount credits are extended to exporters and FX earning firms in Turkish lira with a maturity up to 240 days -360 days for exports of high-tech industrial products, exports to new markets and FX earning services- through the Export Credit Bank of Turkey (Türk Eximbank) and commercial banks by the acceptance of FX bills for rediscount, whereas repayments to the CBRT are made in FX.

Taking into account the contribution of rediscount credits to the decrease in the current account deficit and the increase in the CBRT’s FX reserves, the credit limit was increased by USD 3 billion to USD 20 billion on 26 July 2016. In line with the increased overall limit for rediscount credits, the credit limit per company for Foreign Trade Capital Companies has been raised from USD 300 million to USD 400 million and for other companies, from USD 250 million to USD 350 million.

Moreover, with the change made to rediscount credits’ regulations on 25 August 2016;

• Firms with net sales revenue above TL 15 and 20 billion in the latest financial year were provided with the facility to utilize credits up to three and four times, respectively, the limit introduced to them.

With the change made on 4 October 2016;

• The requirement for minimum of three signatures on the bills to be accepted for rediscount was reduced to two signatures.

With the change made on 14 November 2016;

• In order to reduce Eximbank’s and firms’ exchange rate risk, rates set at 11:00 a.m. started to prevail in the payments of rediscount credits by the CBRT to banks rather than the rates set at 03:30 p.m.

With the changes made on 25 November 2016;

• Regarding the export and FX earning rediscount credits, which would be due by 31 December 2016, it had been decided that the maximum maturity could be extended till 31 March 2017, in case of payment on maturity without utilizing the maturity extension option, credit repayments could be made in Turkish liras and the CBRT buying exchange rates prevailing on the maturity date would be used in these transactions.

Rediscount credit extensions, which were USD 14.5 billion in 2015, reached USD 18.1 billion as of 31 December 2016, with an outstanding balance of USD 10.9 billion.

In this context, rediscount credits contributed USD 15 billion to the CBRT’s net FX reserves in 2016.