Fitch Ratings has upgraded the long-term foreign currency issuer default ratings of several major Turkish banks, citing an improved assessment of Türkiye’s operating environment and stable financial profiles across the sector.

The agency raised the long-term foreign currency ratings of Ziraat Bank, VakifBank and the Industrial Development Bank of Türkiye (TSKB) from "B+" to "BB-", while upgrading their viability ratings from "b+" to "bb-."

Their long-term local currency ratings were affirmed at "BB-" and national ratings at "AA(tur)", all with a stable outlook.

Arap Turk Bank (ATB) also saw upgrades, with its long-term issuer default rating rising from B to B+, its viability rating from b to b+, and its national long-term rating increased from A-(tur) to A(tur). Its outlook was likewise set to stable.

"The upgrades reflect Fitch’s improved assessment of the Turkish operating environment, as shown by the recent revision of the operating environment score for Turkish banks to 'bb-'/stable from 'b+'/positive," the agency said.

"The upgrades also consider the banks' stable business and financial profiles maintained in the context of improved operating conditions."

Fitch noted that the government support ratings of Ziraat Bank, VakifBank and TSKB were upgraded from b+ to bb-, reflecting authorities' strengthened ability to support the banking sector amid improving foreign exchange reserves.

In a separate statement, Fitch announced upgrades for Halkbank, Emlak Participation Bank and Vakif Participation Bank, lifting their long-term foreign currency issuer default ratings from B+ to BB-, also with stable outlooks.

Their government support ratings were similarly raised from b+ to bb-.

The rating agency also said the government support ratings of Türkiye Is Bankasi, Akbank and Yapi Kredi were upgraded from b- to b.