The monetary policy applications of central banks after global crisis : a research on the effects of Turkish banking sector

The mortgage crisis experienced in the USA since mid-2007 gained a global dimension with the bankruptcy of the famous Lehman Brothers Investment Bank in 2008, and it affected the entire world along with the USA with the impact of globalization. Due to the development of technology, countries' trade volumes have increased in the world, and the crisis in a country has become much more rapid than in the past and has become an issue that can affect the whole world. In the aftermath of the global crisis, many banks in developed countries were forced either to go bankrupt or governments had to confiscate them. This situation profoundly influenced the confidence in the banking sector in developed countries and driven the sector into crisis, and we still feel that the effects of the crisis continue to this day. In order to help the banking sector recover from the crisis in many developed countries, especially in the USA, the governments of developed countries around the world adopted a global zero interest rate policy and they developed and implemented trillion-dollar rescue packages. The Central Bank of Republic of Turkey (CBRT) was the first central bank in the world to cut interest rates during the global crisis. After the global crisis, no recovery package was implemented in the Turkish banking sector. On the contrary, profitability and shareholders' equity showed a positive development. The aim of this study was to explore the changes in the monetary policies of the central banks following the global crisis and the effects of the CBRT monetary policy applications on the Turkish banking sector after the global crisis. The first part of this study introduces the concept of global crisis, the definitions related to the crisis, and the causes and consequences of the global crisis. In the second part, the history, duties and powers of the FED, ECB and CBRT, their independence and finally the monetary policies implemented in the post-global crisis period are investigated. Finally, in the last part, the effects of the monetary policies implemented by the CBRT in the post-global crisis period on the Turkish banking sector are reviewed and, by means of the selected indicators, it is revealed that the Turkish banking sector has been affected by the monetary policy implementations.