January 20, 2020 / 9:36 AM / a month ago

UPDATE 2-Turkey cenbank starts sending $6.9 bln to Treasury, others

(Adds central bank statement)

By Nevzat Devranoglu

ANKARA, Jan 20 (Reuters) - Turkey’s central bank said on Monday it started distributing 40.5 billion lira ($6.85 billion) to the Treasury and other shareholders, after its board voted for a second straight year to fast-track payments to boost the government’s budget.

At an extraordinary general assembly, the bank approved the transfer of 90% of its 2019 profits to shareholders, after necessary reserves are retained. The Turkish Treasury holds the largest share in the bank with 55.12%.

The central bank said it had started distributing 35.2 billion lira to shareholders as advance dividend from last year’s profits, as well as 5.3 billion lira of legal reserves from its 2018 profits.

Last year, the bank transferred to the Treasury some 50 billion lira including corporate tax, as well as some 40 billion lira of accumulated legal reserves.

It also held the meeting in January last year, bringing it forward from previous years when it was held in April.

Bankers calculated that the central bank would transfer a total 50-55 billion lira to the Treasury throughout the year.

Despite the legal reserves and other one-off payments, Turkey’s central budget deficit soared 70% last year to 123.7 billion lira as the government boosted spending in the face of local elections and a recession.

The central bank’s balance sheet for 2019 has not yet been published. ($1 = 5.9155 liras) (Additional reporting by Ali Kucukgocmen and Ezgi Erkoyun in Istanbul; Editing by Jonathan Spicer)

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