Turkiye’s debt capital market (DCM) will likely continue its growth and reach USD550 billion in 2026, says Fitch Ratings.
DCM outstanding grew by 19.5% year on year (yoy) in 3Q25, exceeding USD505 billion. High external financing needs, upcoming debt maturities, and funding diversification will remain key drivers. The DCM remains exposed to exchange and interest rate volatilities, geopolitical uncertainties, high inflation, and low external liquidity relative to its high financing requirements.
“The Turkish sukuk market has grown notably in 9M25. Sukuk growth has outpaced bonds, mainly driven by the highest quarterly sukuk issuance in 3Q25,” Bashar Al Natoor, Fitch’s Global Head of Islamic Finance, said. “We expect DCM issuance to remain driven by the sovereign despite projected fiscal consolidation with banks, and corporates having the potential to increase their market presence on an opportunistic basis.”
Fitch rates 91% of US dollar sukuk outstanding (USD17.4 billion) in Turkiye, 95% of which are rated ‘BB-’, all with Stable (97.1%) or Positive (2.9%) Outlooks. All rated sukuk are denominated in US dollars.
DCM issuances increased by 19.2% yoy in 9M25, reaching USD112.3 billion. The Turkish lira continues to be the main currency, accounting for nearly two-thirds of the DCM, with most of the remainder in US dollars.
Non-resident investors’ share of domestic sovereign debt declined to 7.1% by end-9M25, down from 9.9% at 9M24, which was the highest level in four years (2023: 1.9%). Resident banks remain the primary investors, holding 62% of domestic sovereign debt.
Outstanding sukuk rose by 35.9% yoy to USD39.4 billion at end-9M25, nearly twice the 18.3% increase in bonds outstanding. Sukuk’s share of the DCM rose to 7.8% at end-9M25 (9M24: 6.9%). Sukuk issuance in 9M25 has already surpassed full-year 2024 levels by 8.9%, totalling USD12.8 billion and representing 11.4% of DCM issuance in 9M25 (2024: 9.4%).
