The development was just prior to the IMF’s approval, on May 11, of a new $10bn, three-year standby agreement with Turkey. Under the new accord, Turkey would be able to draw the funds in 12 equal installments of $837.5m.
“Turkey’s debts of $19bn to the IMF will fall to under $10bn at the end of the three-year period,” the economy minister, Ali Babacan, told reporters.
Koç Holding officials said Yapi ve Kredi Bankasi, Turkey’s fifth biggest bank, would likely be merged with its Koçbank. The new bank would – for the first time – surpass Akbank, owned by longtime rival Sabanci Holding, and become the country’s third biggest bank.
Yapi ve Kredi Bankasi, which dominates consumer banking in Turkey, posted a loss of $43.7m on assets of $18.3bn in 2004. It employs 10,600 staff at 408 branches, while Koçbank employs 3596 persons at 157 branches and registered a net income of $80.3m on assets of $6.9bn in 2004.
In a related development, Hungary’s National Savings and Commercial Bank began negotiations with Denizbank to acquire a majority stake in the Turkish financial institution, and Turkish conglomerate Dogus Holding reportedly was holding talks with HSBC and Deutsche Bank to sell a large share in Türkiye Garanti Bankasi, Turkey’s fourth biggest commercial bank.
The Yapi ve Kredi Bankasi acquisition, the latest in a series by foreign banks in Turkey, has raised the eyebrows of economic nationalists who fear the country’s sovereignty is endangered.
Gazi Ercel, former governor of the Central Bank of Turkey, warned that foreign banks could gain control of over 50% of the Turkish banking system. “Turkish banking authorities have to decide whether to allow foreign banks to dominate the nation’s banking assets, or to limit their ownership to under 50%,” Mr Ercel wrote in the financial newspaper Dunya.
