Turkey's Halkbank offers higher interest rates to abandon the dollar

Halkbank, a state-run Turkish bank, is offering higher interest rates on deposits for customers who sell foreign currency for liras, NTV news channel reported.

The company will pay clients who open a new “Returning to the Lira from Foreign Currency Account” an extra interest rate of between 0.95 percent and 1.1 percent annually, NTV said, citing a statement from the bank.

The offer applies to customers who sell dollars or euros, the television channel said.

Turkey’s government has been making use of state-run banks to help stimulate economic growth through cheap lending. They have also sought to bolster the lira’s value against foreign currencies by selling forex in the market. Halkbank is controlled by the country’s sovereign wealth fund, which President Recep Tayyip Erdogan has chaired since last summer.

 “We believe that our new product will speed up the transition back to profitable investments such as the lira for customers who had previously invested in foreign currency,” Halkbank CEO Osman Arslan said, according to NTV.

The time is now ripe to invest in liras after market volatility across the globe subsided, Arslan said.