Turkish banks’ shares fell for a fourth day and are on track for the biggest weekly decline in almost two years as Fitch Ratings is said to take some Turkish lenders to rating watch negative, Bloomberg News reported. Fitch Ratings has prepared a report on Turkish banks, according to two people with direct knowledge of the issue and who asked not to be named because it hasn’t been published by Fitch. Report takes some Turkey banks to rating watch negative, according to one of the people.

Turkish President Recep Tayyip Erdogan finally conceded to his financial lieutenants’ currency-rescue plan, but a look back across recent eleventh-hour rate hikes in emerging markets shows it’s not enough to get the lira back on track, Bloomberg News reported. It took three years for Russian Central Bank Governor Elvira Nabiullina to reap rewards for her ultra-orthodox monetary policies, through an influx of investment and low volatility. Argentina saw immediate payoff for its extreme rate move this week -- of more than double Turkey’s 300 basis-points hike.

Contagion? Not this time. Developing nations are defying concern that the tumbling Turkish lira and Argentine peso will infect global financial assets, Bloomberg News reported. While pundits including Mark Mobius said the pain for emerging markets isn’t over and Paul Krugman said the current wobble had the whiff of a crisis to it, markets have been far more sanguine. On Thursday, 16 of 24 emerging-market currencies gained as the lira plunged more than 4 percent even after Turkey’s emergency interest-rate hike. Meanwhile, Argentina’s peso extended a two-day slide.

Turkey’s banks will likely benefit from Wednesday night’s interest-rate increase, though there will be some pain as well, Bloomberg News reported. That’s the assessment of some analysts after the central bank’s emergency move to halt a run on the lira. While there will be a short-term hit to funding costs and lending margins, banks will be helped as the move stems panic in financial markets, according to Cagdas Dogan, a banking analyst at Istanbul-based BGC Partners Inc.

Turkey’s banks are at risk of losing their reputation as the crown jewel of the economy as the government’s single-minded focus on growth threatens to undermine profits and cause an uptick in bad loans, Bloomberg News reported. Lenders in one of the world’s fastest-expanding emerging markets are finding themselves at the center of President Recep Tayyip Erdogan’s ambitions of winning another election in an early vote called for June 24.

Argentina’s latest capitulation may have helped to keep Turkey out of the headlines in recent weeks but some believe the latter’s banking sector could ultimately provide the most dramatic fireworks, the Financial Times reported. When a country has loaded up on foreign currency-denominated debt, the last thing it wants to see is a plunge in its own currency. Unfortunately, Turkey has seen just that, with the lira slumping 12.6 per cent against the dollar since mid-February. A look at the country’s metrics is sobering.

In an unexpected move, Standard & Poor’s cut its sovereign debt rating on Turkey further into junk territory on Tuesday, citing widening concern about the outlook for inflation amid a sell-off in the Turkish lira currency, Reuters reported. S&P said the ratings decision, cutting Turkey to “BB-/B” from “BB/B,” was not part of its regularly scheduled reviews, reflecting what it said were growing concerns. “The downgrade reflects our concerns over a deteriorating inflation outlook and the long-term depreciation and volatility of Turkey’s exchange rate,” S&P said in a statement.

Dogus, one of Turkey’s biggest companies, has neither denied nor confirmed widespread reports that it is restructuring its debt, the Financial Times reported. But economists and analysts fear the company could be a canary in the coal mine for Turkey’s corporate debt problems. For years, economic growth has been fuelled by cheap international credit. Corporates took out large loans in dollars or euros. But with the currency sliding, the cost of servicing that debt is rocketing.

Investors are bracing for trouble at Turkey’s banks as some of the nation’s biggest conglomerates struggle to repay their debts, Bloomberg News reported. The Borsa Istanbul Banks Index, which comprises 13 lenders, underperformed the Borsa Istanbul 100 by 20 percent over the past year. Valuations dropped to a nine-year low in November, and have remained there. The banks index trades at 4.9 times estimated earnings, compared with 7.6 times for the broader market.

The consortium formed to build and operate the world’s biggest airport in Istanbul was facing enough challenges even before the government minister in charge of the project started talking about insolvency, Bloomberg News reported. In a television interview late Monday, Transport Minister Ahmet Arslan confirmed the government was considering giving the consortium an unspecified amount of time before requiring it to start paying rent, which has been set at more than $1 billion annually over 25 years. But then he went a step further.