Turkish loan growth falls below 25 percent

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ISTANBUL Feb 27 Growth in Turkish bank loans eased below 25 percent in mid-February, adding to signs of a gradual economic slowdown after a year of unorthodox monetary policy aimed at preventing overheating. Loan growth stood at 24.83 percent from a year earlier as of Feb. 17, down from 25.15 percent a week earlier, according to weekly data published by banking regulator BDDK. Year-on-year loans growth stood at 29.50 percent at the end of 2011, above the central bank's target of 25 percent growth for the full year.

The central bank had said it wanted to keep growth to 25 percent in 2011, after loans expanded 34 percent in 2010, fuelling demand for imports that have led to worryingly high external deficits.

The bank has not given a target for loan growth this year, but Deputy Prime Minister Ali Babacan, who oversees economic policy, said in January he expects loan growth of 15 percent.

The nominal figures provide the basis for the central bank's considerations on monetary policy, although it tends to refer publicly to numbers adjusted for shifts in exchange rates.