By the second half of 2019, Turkey’s economy was on the road to recovery. Three quarters of consecutive economic contraction, which stemmed from the country’s 2018 currency crisis, had finally come to an end by the second half of 2019, as positive growth numbers accelerated.
In the final quarter of the year, the economy expanded by a figure of 6% year-on-year. For Turkish banks, this meant an uptick in business and expanding loan books. But it was not enough to lift profits, which for the system as a whole, fell over the course of 2019. Over the same period, non-performing loans increased across the sector, as the fallout from the country’s economic travails played out in terms of asset quality.
The Banker’s Top 1000 World Banks 2020 points to these difficulties, while also revealing the new growth opportunities that had started to emerge before the onset of the Covid-19 pandemic.
Turkey’s third largest bank by Tier 1 capital, Akbank, tops the best-performing banks ranking for the country with a score of 7.71 out of a possible 10 points. This comes on the back of impressive profitability and operational efficiency performance numbers, where the bank takes first position, while mirroring this feat with respect to return on risk, soundness, liquidity and leverage.
Akbank’s weakest performance dimension relates to its growth numbers, where it ranks sixth. The second best-performing Turkish bank is TC Ziraat Bankasi, the country’s largest bank by Tier 1 capital, with an overall score of 5.64 out of 10. This is underlined by the bank’s top performance in the asset quality stakes, as well as in its soundness metrics, where it takes second position.
The second largest bank by Tier 1 capital, Türkiye Is Bankasi, is third in the best-performing banks ranking with a score of 5.4. The lender’s strong showing in terms of its profitability, leverage, liquidity, return on risk and asset quality, secures it second place in these metrics, helping it to emerge as one of the market’s leading banks. Nevertheless, it is sixth in terms of its operational efficiency, meaning it has some way to go improve in this dimension relative to its peers.
Turkey’s fastest growing bank over the review period is VakifBank, with an outstanding growth score of 8.82. However, the lender is fifth in terms of overall performance among the country’s best-performing banks, with a score of 4.25 out of 10. Its score was affected by, among other things, a weaker profitability ranking, for which it ranks sixth with a score of 3.91.
