The ratio of Bank Nonperforming Loans (NPL) to Total Gross Loans in Turkiye has seen significant fluctuations from 2013 to 2023. Notably, the NPL ratio reached its peak at 5.02% in 2019, following a steady increase over several years. However, this was followed by a marked decline to 1.85% in 2023.

Year-on-year variations reveal a -7% decrease from 2022 to 2023, maintaining a downward trend from the previous year. Looking forward, the forecasted Compound Annual Growth Rate (CAGR) over the next five years to 2028 is expected to be -6.83%, indicating a significant reduction in the NPL ratio, which is projected to decrease by 1.72 percentage points to 1.21% by 2028.

Select future trends to watch for:

Regulatory changes and their impact on loan quality management.
Economic factors such as inflation and interest rates which can affect loan repayment capabilities.
Monitoring global financial stability as it can influence local borrower defaults and risk assessments.