More gain than pain from article 64
This support was crucial - as the crisis countries of south-east Asia are learning - because during the rescheduling most banks cut their lines to Turkey. The CTLD restructuring came on the eve of one of the worst periods in recent Turkish history. Forex reserves had virtually evaporated and the country was on the brink of civil war. The army overthrew the right-wing government of Suleyman Demirel and declared martial law. In the environment of enforced calm, the generals chose a government to make market-oriented economic reforms. The economy was transformed almost overnight.
As soon as economic liberalization was announced Citibank opened a branch in Istanbul. "I believe that this was the first foreign-bank licence to be approved since 1923," says John Bernson who became Citibank's first Turkey general manager. The bank opened for business in May 1981 with an original focus on trade finance and treasury, activities underexploited by Turkish banks.
"I think Citibank made a difference for two reasons," said Bernson. "Number one, it and a couple of other foreign banks showed just how profitable trade-finance business could be.