Investment in Turkey - Turkish Banking

GE Turkey chief plans to keep Garanti stake

General Electric said on Tuesday that it has no plans to sell its stake in Garanti Bank, Turkey's third-biggest lender, while it remains profitable. GE also plans to keep its energy projects in Turkey, despite increased difficulty in obtaining financing, according to Kursat Ozkan, Head of GE's Turkish unit, told reporters. GE is not considering changing its financial portfolio in Turkey, said Ozkan, adding that it considers Istanbul-based Garanti as one of its most reliable investments.

Foreign investors eye Turkish banks

While the financial markets of the world experience a significant shrinkage, the Turkish banks are not having any difficulty with funding. Hulya Kefeli, Executive Vice President of Akbank, said the Turkish banks, with their strong financial structure, have become more attractive for foreign investors during the global crisis. Kefeli added, “There are only a few countries which are as creditworthy as Turkey in a time of a global financial crisis when economical confidence gains more importance than ever”.

Turkish banks continue to grow in global economic crisis

DenizBank announced last week that in 2008 its net profits rose 15 percent year-on-year to TRY 342 million, while Sekerbank, on the same day, noted an increase of 17 percent in net profits last year to TRY 144 million.

Istanbul to be certified as a ‘Financial Center’

Nazim Ekren, Minister of State and Deputy Prime Minister, said that making Istanbul a financial center is one of the global projects Turkey is focusing on and added that the necessary documents will have been received by the year end. Ekren added, “We will make Istanbul- Financial Center Strategy Certificate public late this year when meetings with the World Bank and IMF will be held.”

Turkish banks value soars amidst financial crisis

As market value of the world’s banking giants erode due to the financial crisis, Turkish banks leapt forward in 2008. The "Global 500 Financial Brands" survey by Brand Finance and The Banker magazine, revealed over the weekend, showed nine Turkish banks ranking with global giants.

Turkey’s Isbank was the bank that leapt most in the ranking for 2008. As global giants such as Lehman Brothers and Bear Stearns bankrupted and rivals such as Citigroup and Merrill Lynch eroded in market value, Isbank ranked 84th most valuable financial institution of 2008. The Turkish bank stood as 190th in the 2007 list. The market value of Isbank rose to USD 1.2 billion, from USD 557 million in 2007, the survey showed.

Turkey’s Yapi Kredi ranked 121st in the 2008 list, while Garanti Bankasi stood as 134th and Akbank as 137th. Halkbank and Turk Ekonomi Bankasi, meanwhile, were able to make it to the list for the first time, as 224th and 323rd, respectively. Vakifbank, Finansbank and Denizbank also made it to the list. Seven of the nine Turkish banks on the list were awarded "A" in brand value in 2008.

Rational investors would designate Turkey as their top priority

Edoardo Spezzotti, Head of Markets and Investment Banking Department of Unicredit, the 3rd largest financial group in Europe which also owns 50% of Yapı Kredi Bank, said, "If its great success in fiscal discipline, financial flexibility and stability continues the way it has been, and if it goes on sending right signals to the investors, Turkey will continue to be an attractive country in terms of investment. In this respect, I have complete trust in Turkey." Spezzotti also said, "We, as UniCredit, are of the idea that Turkey will benefit from this crisis in medium and long term. A rational investor would designate Turkey as his/her top priority among developing countries.”

They said, ‘We will grow with Turkey' and remained untouched by the crisis

While the world giants such as Dexia, Citibank and Fortis have been thrown into a survival struggle, their associations in Turkey are enjoying their pleasant profits. Banks with foreign partners which have not suspended their investment plans despite the crisis since they rely on the Turkish market have succeeded in making a profit of approximately 5 billion YTL for the first six months of the year. During the first six months of the year, Akbank, which has partnership with Citibank, made a profit of 1.25 billion YTL; Denizbank, in which Dexia has shares, made a profit of 186 million YTL; Garanti, which is a partner of General Electric, netted 1.029 billion YTL; Yapi Kredi, which partnered with Unicredito, made a profit of 740 million YTL, while Fortis, which has been saved for the second time abroad, netted 155 million YTL and Finansbank, which has been acquired by the Greek, made a profit of 258 million YTL.

There may be 10-20% foreign partnership in Bank Asya

General Manager of Bank Asya, has stated that they may establish a strategic partnership of 10-20% with a foreign bank in order to maintain their strength in the finance sector which has turned into an arena of size combat.

NBG increases its share in Finansbank

National Bank of Greece (NBG), who acquired 46% of Finansbank 2 years ago for $2.78 billion, has announced that they will acquire 9.68% Finansbank’s capital for $697,150,000. NBG's shares of Finansbank will be close to 94.5%.

Turkish banks financed major international banks with $10 bln

Turkish banks provided around $10 billion everyday to some of the world’s largest banks, which faced liquidity shortage in the recent global financial turmoil. Unable to offer currency-loans to real sector companies in Turkey due to legislation, Turkish banks, with more than $20 billion in foreign currency abroad, financed the banks experiencing liquidity shortage at 7% interest during the recent financial crisis. Turkish banks did not take advantage of the recent surge in overnight borrowing rates that climbed to 10-12 percent after Lehman Brothers filed for bankruptcy.

S&P: Turkish bank fundamentals stand strong to strains

Turkish bank fundamentals are standing up both to domestic and international strains, Standard and Poor's said in its report titled as Bank Industry Risk Analysis: Turkish Banks Withstand Heightened Environmental Hurdles. Unlike other emerging markets in the region, particularly in the Commonwealth of Independent States, Turkish banks benefit from diversified funding and good liquidity, with relatively moderate reliance on international wholesale funds, S&P said in the report.