(Adds comments by head of banking association)
ISTANBUL, Sept 18 (Reuters) - The head of Turkey’s banking association said on Wednesday that about half of the 46 billion lira ($8.1 billion) of loans that under a new regulation will be reclassified as nonperforming comes from the energy and construction sectors.
In an interview with broadcaster NTV, Huseyin Aydin said that banks would need to provision 12 billion lira for the new nonperforming loans, or NPLs.
Most of the loans to be transferred to NPLs were in foreign currencies and did not include debt belonging to state-run firms, he said. In a worst-case scenario, up to 20% of banks’ “Tier 2” loans would become NPLs, he said.
Separately, Aydin also said that talks to buy a stake in credit ratings agency JCR Eurasia are still going on, adding that if the talks fail, Turkey could still launch its own credit ratings agency.
The establishment of a local credit ratings agency would allow effective use of banks’ resources as it would rate companies that want to borrow in Turkish liras, Aydin said. ($1 = 5.6639 liras) (Reporting by Ali Kucukgocmen in Istanbul Editing by Jonathan Spicer and Matthew Lewis)