4/9  BIS central bankers' speeches  MAS has comprehensively expanded its liquidity facilities – in four ways: what currency we lend in; how long we lend for; what rate we lend at; and what collateral we take. The MAS USD Facility has helped to maintain stable US Dollar funding conditions. Since its introduction in March last year on the back of a swap line with the US Federal Reserve, the MAS USD Facility has provided $ 25 billion to banks for use in Singapore and the region. Alongside the extension of the Fed swap line, MAS has extended the USD Facility to endDecember 2021. The MAS SGD Term Facility has extended the tenor of Singapore Dollar lending from overnight to up to three months. The facility was set up pre-emptively to meet higher precautionary demand for SGD liquidity by banks and finance companies. This helped promote more stable funding conditions and support credit intermediation to businesses and households. The MAS SGD Facility for ESG Loans has provided funding at 0.1% to financial institutions for lending to small and medium enterprises under the ESG loan schemes. The Facility, which has helped to reduce the borrowing costs for viable businesses, has been extended till end-September 2021. As of 31 March 2021, about $ billion was lent to eligible financial institutions, catalysing around $ billion of ESG loans and benefitting more than 22,000 firms. Utilisation of the Facility was lower in 2021 compared to 2020 as the cashflows of firms improved.

At present, the Turkish banking sector has up-to-date technology and is equipped with highly qualified personnel to compete in the international arena. The result is a more transparent and well-functioning banking sector whose players have been progressively modernizing their operations in line with the developments in the global banking community. There is a significant growth potential in the Turkish banking sector. Banks will have to compete in an increasingly challenging environment. In the coming years, strategically and technically well-positioned banks will be able to utilize the growth potential of the sector. However, increasing competition and squeezed profit margins are expected to force banks to be more cost conscious. In order to increase profitability and efficiency, mergers and strategic alliances with foreign banks will be on the agenda of the sector. The integration process with the EU will bring new challenges for Turkish banks to increase their efficiency and quality of their services by improving their distribution channels. Additionally, increasing compliance with the internationally accepted standards and other structural changes made in line with the integration process with the European Union will attract foreign banks, which in turn will intensify the competition in the sector. Another significant step taken by Turkish authorities was the introduction of the recent disinflation program and the other restructuring efforts. Turkey has suffered from chronically high inflation for years and our economy is the last high-inflation economy among the OECD countries. High level of public deficits and fiscal imbalances, together with self-fulfilling inflationary expectations are the main causes of the inflation process.