In 2000-01 Turkey became one of the latest emerging markets that were hit by the shattering twin crisis - the collapse of currency was accompanied by a severe crisis of the banking sector. Its costs appeared to be very high - the restructuring of the banking sector cost over USD 53 billion, i.e. approximately 36% of the GDP. The aim of this article is to present the specificity of the Turkish crisis stressing the role of structural weaknesses of the banking sector. Once again in the case of Turkey the structural weaknesses played a crucial role not only as causes of the crisis but also as factors influencing its course and determining the costs borne by the whole society. The case of Turkey underlines the need for adopting adequate institutional arrangements (safety net) protecting the financial system from destabilization.

Keywords: financial crisis, banking crisis, Turkey, safety net, crisis management.

  Adam Pawlikowski, Financial Crisis in Turkey in 2000-2001 - plik pdf; (226 KB)