TURKISH BANKS' NON-INTEREST INCOME AND THE IMPACT OF THE CBRT REGULATIONS

Banks, which serve to facilitate the transfer of funds between deficit and surplus positions, seek to maximize their income in order to maximize their profits. In order to achieve this, banks attach great importance to the generation of non-interest income as well as interest and fee income, which represent their primary sources of revenue. In this study, we analyze the impact of potential determinants of non-interest income in the Turkish banking sector on non- interest income using a panel data set. Accordingly, this study analyses the determinants of non-interest income in the Turkish banking sector using a data set of 19 banks and 11 years. The analysis demonstrates that bank-specific variables, including the net interest margin, loans-to-assets ratio, asset growth rate, capital adequacy ratio, return on equity, and the inflation rate, significantly and negatively impact non-interest income. In contrast, changes in the return on assets and gross domestic product have a positive and significant effect on primary income. Furthermore, the CBRT's regulations on fees, charges and commissions in 2020 are anticipated to influence the non-interest income ratio of the Turkish banking sector, particularly that of public banks. Moreover, the study may also contribute to the academic literature on potential regulatory policies that could impact the primary income of banks.