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Turkish bank Akbank has signed a syndicated dual-currency term loan worth US$560mn, with the funds earmarked for trade finance purposes.

Akbank concluded the US$246mn and €284mn facilities with 24 banks from 12 countries at the start of the month. The facilities, which come with a one-year maturity, renew an existing syndicated loan deal struck in March 2019.

In a statement, Akbank says that the total size of the deal may increase “through the accordion feature of the facility” which allows banks that “have difficulties in meeting the deadline due to working hour constraints” to participate up until the withdrawal date of the loan on April 9.

Commenting on the transaction, Akbank CEO Hakan Binbaşgil notes: “The global Covid-19 pandemic has [had] a negative impact on real economies and daily life as well as on financial markets. Along with the difficult access to liquidity and FX resources, the transition of many companies and banks to remote working affects the ratification process of syndicated loans.”

With Turkey’s death toll rising to 574 on Sunday the country’s President, Recep Tayyip Erdogan, has announced new restrictions on travel and other freedoms. A curfew is now in place for those under the age of 20, or over the age of 65. Meanwhile a 15-day ban on all but essential travel in and out of major cities such as Istanbul has also been put in place.

Much like other nations around the globe, the Turkish government moved to help domestic businesses survive the current crisis by passing a US$15bn economic support package last month.

However, with the threat of a global recession or even depression looming, experts say that Turkey’s economy will likely be affected by the virus. The ratings agency Moody’s, for instance, notes in a recent report that it expects Turkey’s economy to be hit the hardest out of the G-20 economies, “with a cumulative contraction in second and third quarter GDP of about 7.0%”.

Meanwhile the Institute of International Finance has revised its 2020 growth outlook for Turkey down from 2.2% to 0.6%.

The country’s economy had been picking up towards the end of last year, and had even returned to growth in the third quarter of 2019, before hitting 6% annualised growth in quarter four, having gone through a dire period in August/September 2018 which saw the lira lose more than 45% of its value.

Bookrunners and mandated lead arrangers on the Akbank deal include Abu Dhabi Commercial Bank, Bank of America Merrill Lynch, Citibank, Emirates NBD, ICBC Turkey Yatırım Menkul Değerler, Mizuho, Standard Chartered and Sumitomo Mitsui Banking Corporation.

The lead arrangers are BNP Paribas, Commerzbank, Filiale Luxemburg, Intesa Sanpaolo, MUFG Bank, Société Générale. Meanwhile Attijariwafa Bank, Bank of New York Mellon, BPER Bank, Credit Suisse, DZ BANK, Erste Group, Goldman Sachs, Habib Bank, Mashreqbank and Zürcher Kantonalbank all participated as arrangers.