The recently imposed regulation forcing unemployment and catastrophe insurance funds to be deposited only in state banks has resulted in a significant decrease of the financial gains of the two entities due to a drop in interest rates in the absence of competition, sources quoted by Balkans.com have said.

The change made in the Public Treasury Communique in January compelled the Unemployment Insurance Fund and the Natural Disaster Insurance Institution (DASK) to only keep their respective TRY 7 billion and TRY 2.5 billion deposits in three state-run banks. As a result, instead of benefitting of high interest rates born by the commercial banks' interest in attracting these giant sums, the two funds saw themselves forced to accept an ever decreasing interest rate offered by the state-controlled banks. Banking sources have even accused the three public banks - Halkbank, Ziraat Bank and Vakıfbank -, of allying to offer the lowest interest rate, which means around a two-point interest decline each year.

A fall of around two points results in a loss of TRY 140 million for the Unemployment Insurance Fund and TRY 50 million (~ EUR 17 million) less for the DASK fund.

According Hurriyet daily news, bankers argue that the amendment is aimed at recovering reserved requirement ratios of state-owned lenders and empowering them to provide more loans. Therefore, the new scheme serves the three public banks' profitability, even as the value of the unemployment fund, which is formed by deductions from millions of employees' wages, and natural disaster fund decline.