Central Bank of the Republic of Turkey
Turkey’s central bank, responsible for monetary policy, exchange-rate policy, reserves, banknote issuance, payment systems and financial stability.
Last updated August 26, 2026
AI crawler reads
No AI crawler has read this profile since Oct 28, 2026.
Overview
The Central Bank of the Republic of Turkey, commonly known by its Turkish name Türkiye Cumhuriyet Merkez Bankası and the acronym TCMB, is Turkey’s central bank. Its institutional roots lie in the Ottoman Empire’s experiments with government finance, paper money and externally backed banking, but the modern institution was created during the Republican period as part of the effort to establish economic sovereignty and an independent national monetary authority. The bank was established under Law No. 1715, enacted in June 1930, and began operations on 3 October 1931. Its creation followed discussions that had intensified after the 1923 İzmir Economic Congress. Earlier Ottoman institutions, including the Ottoman Bank and the Imperial Ottoman Bank, had performed selected treasury, note-issuing and financial-intermediation functions, but they were not equivalent to a fully national central bank. The Republican government sought an institution capable of issuing currency, conducting monetary operations, managing the state’s banking functions and supporting the stability of the Turkish currency. The CBRT’s statutory responsibilities have expanded over time. They include designing and implementing monetary policy, conducting exchange-rate policy, managing Turkey’s international reserves, issuing and printing banknotes, operating and regulating payment systems, and contributing to financial stability. The bank also maintains market infrastructure and conducts transactions in money, foreign-exchange and securities markets. Its policy instruments include interest-rate facilities, reserve requirements, open-market operations, liquidity management and other tools authorized by law. The institution’s legal framework has changed substantially. The 1970 Central Bank Law reorganized its governance, increased its capital and established the office of the governor. Market-oriented reforms after 1980 expanded the bank’s role in foreign-exchange and reserve management and led to the beginning of open-market operations in 1987. The 1989 liberalization decree made the Turkish currency convertible and enabled broader foreign-exchange transactions. In 1990, the bank published a monetary program for the first time. The financial crisis of 1994 and the severe crisis of 2000–2001 led to important reforms. Following the abandonment of the exchange-rate-based stabilization program and the move to a floating exchange rate in February 2001, amendments to the central-bank law established price stability as the bank’s primary objective and granted it instrument independence. The amendments also restricted direct financing of the Treasury and prohibited primary-market purchases of government debt, reducing the formal ability to use central-bank resources for public financing. Financial stability became a supporting objective, provided it did not conflict with price stability. Since 2006, the CBRT has operated a formal inflation-targeting framework. In practice, its decisions have been closely watched because Turkey’s economy is highly exposed to exchange-rate movements, imported energy costs, external financing conditions, inflation expectations and changes in global interest rates. The bank therefore operates at the intersection of monetary policy, currency management, banking-system liquidity and macroeconomic stabilization. The CBRT is not a commercial bank and does not market consumer banking products. Its principal public-facing outputs are policy decisions, inflation and monetary-policy reports, statistical releases, payment-system services, banknotes and communications concerning financial and monetary conditions. It also maintains international reserves and supports the functioning of domestic financial markets. The bank remains an active institution of the Turkish state, although its precise degree of operational and policy independence has been a recurring subject of public and economic debate.
History
The history of the CBRT is connected to the gradual development of monetary institutions in the Ottoman and Republican periods. Before the nineteenth century, treasury offices, the mint, moneylenders, merchants, foundations and guilds carried out functions that today are associated with public finance and banking. The Ottoman government introduced paper money, known as kaime, in 1840. During the Crimean War, the need to intermediate external borrowing contributed to the establishment of the Ottoman Bank in 1856. In 1863, that institution was reorganized as the Imperial Ottoman Bank, which received an exclusive banknote-issuing privilege and performed treasury-related duties. Its foreign ownership and limited national character encouraged support for a domestic central bank. The Ottoman National Credit Bank was established in 1917, but the defeat of the Ottoman Empire prevented it from developing into a national central bank. After the establishment of the Republic, monetary sovereignty became part of the broader project of political and economic independence. The 1923 İzmir Economic Congress called attention to the need for a national state bank. A draft central-bank proposal was submitted in 1927, and foreign and domestic experts subsequently advised the government on the institution’s design. The Central Bank Law No. 1715 was enacted on 11 June 1930 and published later that month. The bank began operating on 3 October 1931. Under its original framework, the CBRT was a joint-stock company with four share classes. Treasury ownership was limited by the original law in an effort to present the bank as institutionally distinct from the government, while other shares were allocated to banks, privileged companies and Turkish commercial institutions or individuals. The bank received the exclusive authority to issue banknotes and was empowered to regulate money and credit markets, conduct treasury operations, set rediscount rates and support the stability of the currency. During the 1930s, the institution operated with comparatively limited government intervention and inflation remained relatively restrained. The Second World War and its aftermath changed that balance. During the 1940s, monetary operations were used extensively to help offset public-finance pressures, and the general price level rose sharply. In the 1950s, central-bank resources helped finance rapid growth and public spending through short-term advances to the Treasury. A banknote-printing plant was established in 1955, and domestic printing of banknotes began in 1957. During the planned-economy period of the 1960s, expansionary monetary policies supported public-sector financing and industrial development, while many foreign-exchange-control responsibilities were transferred to the bank. Law No. 1211, enacted in 1970, created a new legal and organizational framework. The bank’s capital was increased, the Treasury was required to hold at least 51 percent of the capital, and the office of the governor was created for international representation and institutional leadership. Naim Talu became the first governor to use the title formally. The law also established an executive committee and broadened the bank’s authority to use monetary-policy tools, including open-market operations and medium-term rediscount lending. Treasury borrowing limits were increased at the time, reflecting the continuing importance of public-sector financing. The economic reforms that began in 1980 moved Turkey toward market pricing, financial liberalization and a more flexible exchange-rate regime. Interest rates increasingly reflected market conditions, the lira was devalued, and the bank gained stronger authority over gold and foreign-exchange reserves. Open-market operations began in 1987, and the CBRT helped develop modern money and foreign-exchange markets. Decree No. 32 in 1989 liberalized foreign-exchange transactions and made the Turkish currency convertible. The bank published its first monetary program in 1990, although the Gulf War, political instability, weak fiscal conditions and banking-sector vulnerabilities contributed to the financial crisis of 1994. During the 1990s, the CBRT worked to limit monetary financing of public debt. Restrictions were imposed on Treasury use of central-bank funds in 1994, and a 1997 protocol provided that the Treasury would cease using short-term advances from the bank from 1998 onward. An exchange-rate-based stabilization program launched in 2000 failed amid worsening confidence and financial instability. The program was abandoned during the 2001 crisis, and Turkey adopted a floating exchange rate on 22 February 2001. The post-2001 restructuring produced the most important modern change in the bank’s mandate. Amendments enacted on 25 April 2001 made achieving and maintaining price stability the primary objective, granted the bank discretion over monetary-policy instruments, and prohibited advances or credit to the Treasury and other public institutions as well as primary-market purchases of public debt. The bank was also directed to support growth and employment policies when consistent with price stability, while financial stability was recognized as a supporting objective. Since 2006, the CBRT has used a full inflation-targeting regime. Its contemporary activities combine interest-rate and liquidity management, exchange-rate operations, reserve management, payment-system responsibilities, banknote issuance and financial-stability functions.
- 2006
Formal inflation targeting begins
[1]The CBRT adopted a full-fledged inflation-targeting framework.
- 2001
Floating exchange rate adopted
[1]Turkey abandoned its exchange-rate-based stabilization program and moved to a floating exchange-rate regime during the 2001 crisis.
- 2001
Price stability becomes primary objective
[1]Legal amendments made price stability the CBRT’s primary objective, granted instrument independence and restricted direct public-sector financing.
- 1990
First monetary program announced
[1]The bank published its first monetary program, seeking to meet market liquidity needs without destabilizing exchange rates and interest rates.
- 1989
Foreign-exchange liberalization
[1]Decree No. 32 broadened foreign-exchange transactions and introduced convertibility of the Turkish currency.
- 1987
Open-market operations begin
[1]The CBRT began conducting open-market operations and helped establish modern domestic money and foreign-exchange markets.
- 1970
Law No. 1211 reorganizes the bank
[1]A new central-bank law revised governance, capitalization, authority and monetary-policy instruments, and formalized the governor’s office.
- 1957
Domestic banknote printing begins
[1]Banknotes began to be printed domestically rather than relying exclusively on external production.
- 1955
Banknote printing plant established
[1]Turkey established a domestic banknote-printing plant under the central bank.
- 1931
Bank begins operations
[1]The modern central bank began functioning on 3 October 1931.
Products and positioning
Turkey’s national monetary authority and central institution for price stability, currency operations, reserves, banknotes, payment systems and financial stability.
Central banking
Monetary policy operations
The CBRT designs and implements monetary policy using interest-rate facilities, liquidity tools, reserve requirements, open-market operations and other instruments permitted by law. Since 2006, these activities have been organized around a formal inflation-targeting framework, with price stability as the primary statutory objective.
Central banking
Foreign-exchange and reserve management
The bank manages Turkey’s international reserves and conducts foreign-exchange operations within the country’s monetary and exchange-rate framework. Its reserve and currency functions became more prominent after the liberalization reforms of the 1980s and the adoption of a floating exchange rate in 2001.
Currency issuance · 1931
Banknotes
The CBRT holds the exclusive authority to issue Turkish banknotes and oversees their production and circulation. A domestic banknote-printing plant was established in 1955, with printing in Turkey beginning in 1957.
Financial infrastructure
Payment systems
The bank establishes, maintains and regulates payment-system infrastructure in Turkey. These responsibilities support settlement, liquidity transmission and the reliable functioning of domestic financial markets.
Public information
Economic and financial statistics
The CBRT publishes monetary, financial and economic information used by policymakers, financial institutions, researchers and the public. Its communications include policy decisions, inflation assessments and market-related data.
Brand decisions
2006
Full-fledged inflation targetingStrategyBackground
Following the post-2001 restructuring, Turkey sought a transparent framework for anchoring inflation expectations and communicating monetary policy.
Action taken
The CBRT began operating a full-fledged inflation-targeting regime.
Aftermath
Inflation targeting became the central organizing framework for the bank’s policy communication and interest-rate decisions.
2001
Adoption of instrument independence and stronger price-stability mandateStrategyBackground
The 2000–2001 stabilization program failed amid a loss of confidence and a severe financial crisis. The resulting institutional reform sought to prevent monetary policy from being used directly to finance public deficits.
Action taken
Amendments to the central-bank law made achieving and maintaining price stability the primary objective, gave the bank discretion over its policy instruments, and prohibited advances to public institutions and primary-market purchases of their debt.
Aftermath
The amendments established the modern legal basis for the CBRT’s instrument independence and its later inflation-targeting framework. Financial stability was retained as a supporting objective where consistent with price stability.
2001
Move to a floating exchange rateStrategyBackground
The exchange-rate-based stabilization program launched in 2000 became unsustainable as financial confidence deteriorated and the banking crisis intensified.
Action taken
Turkey abandoned the program and adopted a floating exchange-rate regime on 22 February 2001.
Aftermath
The CBRT’s policy framework shifted toward managing monetary conditions and inflation expectations without maintaining a fixed exchange-rate target.
Sources1 sources
Cite this profile: Cite the canonical profile. /brand-wiki/central-bank-of-the-republic-of-turkey · Editorial policy · How profiles are compiled