The heads of Turkey's biggest banks have promised Prime Minister Binali Yildirim they will support economic growth, the premier's office said on Wednesday, following repeated calls from the government for cheaper credit.
Yildirim met the chief executives of Turkey's banks in the capital Ankara on Tuesday. Like President Tayyip Erdogan, Yildirim has been urging lenders to lower their interest rates to spur spending and bolster Turkey's flagging economy.
"Bankers said they would work in light of their responsibilities to contribute to the rapid growth of Turkey, and added that Turkey continued its development despite a slowing down of global economic growth and a contraction of trade volumes," Yildirim's office said in a statement.
Turkey's central bank has cut interest rates at seven of its last eight meetings. Erdogan, who favours growth through consumption, has described himself as an "enemy" of interest rates, calling them a "means of exploitation".
"I am warning banks, please listen to the sector. Stop loan sharking... Get back to the real economy," Yildirim said last month.
"Sometime in the future you will try to transfer funds to the economy and it will be too late ... You will either do this yourselves or we will make you do it."
Isbank, Turkey's largest listed lender, cut its lending rates on Monday. At a news conference announcing the move, Chief Executive Adnan Bali told reporters the government was seeking to revive the economy following a failed military coup on July 15.
"What falls on institutions that have an ability to make a systemic impact on the economy due to their scale is to make sure the effects of that crisis aren't felt by anyone, and to act as a breakwater of sorts," he said.
On Wednesday Garanti Bank, Turkey's second-largest listed bank by assets, followed suit, saying it would cut consumer loan rates and provide credit support to contribute to economic growth.
Other lenders, including Akbank, Yapi Kredi and Vakifbank have said they have taken similar moves.
The moves could spark concern about inflation, now running at 7.28 percent, well above the government's 5 percent target.
Finance Minister Naci Agbal told Reuters in September that economic growth was likely to be below 4 percent this year, missing the government's 4.5 percent target.