Turkish companies will no longer be required to count foreign-currency losses when assessing whether to file for bankruptcy, according to a legal change introduced at the weekend, a move that could deepen concern about private sector debt, Reuters reported. The move is the latest government measure to help companies squeezed by a sell-off in the Turkish lira this year, and highlights the difficulty firms, and banks, face in what analysts say is likely to be a wave of debt restructuring. For years Turkish companies have borrowed in hard currency, drawn by lower interest rates. But a 40 percent decline in the lira this year — triggered by investor concerns about President Tayyip Erdogan’s growing authoritarianism and the lack of central bank independence — has driven up the cost of servicing that debt. JPMorgan estimates that Turkey’s private sector has around $146 billion in external debt maturing in the year to July 2019.
