Türkiye Wealth Fund plans full rollover of syndicated loan

Türkiye’s sovereign wealth fund (TWF) is seeking to fully roll over its €790 million ($810.8 million) syndicated loan maturing in March, according to individuals familiar with the matter speaking to the Bloomberg.

The move comes amid improved investor sentiment following Türkiye’s adoption of more conventional monetary policies.

Loan details and market context

The loan, unlike the one issued in 2023, will be unsecured, meaning it will not carry guarantees from the Turkish Treasury and Finance Ministry. Coordinators for the deal include Industrial and Commercial Bank of China Ltd. (ICBC), Emirates NBD, and First Abu Dhabi Bank PJSC (FAB).

A previous loan in 2023 had been coordinated by ICBC and Emirates NBD, with ICBC acting as the lead bookrunner and senior arranger.

The wealth fund is reportedly considering the addition of a dollar tranche to the euro-denominated loan.

The TWF declined to comment, while ICBC and FAB did not respond to inquiries. An Emirates NBD spokesperson stated that the institution does not comment on such matters.

Shift in market sentiment

The 2023 syndicated loan fell short of its rollover target, largely due to limited foreign demand for Turkish assets ahead of the national elections. However, investor confidence has risen as Türkiye‘s monetary policy shifted to focus on curbing inflation through significant interest rate hikes.

The TWF’s effort to roll over the full amount of its loan reflects this favorable environment and signals a renewed push to leverage improved financial conditions.

Background on Türkiye Wealth Fund

Established in 2016, the TWF was created to facilitate large-scale investments deemed beyond the capacity of the private sector. It manages a portfolio of assets transferred from the Treasury, including stakes in major state-owned banks such as Halkbank and Ziraat Bank.

The fund also holds shares in Turkish Airlines and the Borsa Istanbul stock exchange.