| Turkey’s leading participation bank, Bank Asya, is considering acquiring a bank in the Balkans, bank General Manager Abdullah Çelik told Reuters Wednesday in İstanbul. (source) | |
| Noting that the bank has set its eyes on expanding in the Balkans, Çelik said they have been conducting market research for the possible acquisition of a bank with a total value of $10 to $20 million in the region. Bank Asya’s plan to branch out into foreign markets comes amid reports of new Turkish banks opening branches, particularly in the Balkan and Gulf regions. Çelik said they would cooperate with the Islamic Development Bank (IDB) in buying a bank in the Balkans. In line with its strategy of expanding abroad, in 2009 Bank Asya entered into a strategic partnership agreement with the Islamic Corporation for the Development of the Private Sector (ICD), an agency of the IDB. According to the partnership, Bank Asya is engaging in interest-free banking activities, along with the ICD. The bank has been interested in entering the Balkan market for a long time, and they find the prices “affordable.” Mentioning recent measures implemented by the central bank, Çelik said the decision concerning required reserve ratios has affected the bank’s returns on capital negatively. The central bank had earlier cut required reserve ratios on foreign-exchange deposits of maturities of one-year and longer, in an attempt for the Lira to gain value against foreign currencies. Çelik said they expected an anticipated move to increase the share of cash loans by the central bank to help increase Bank Asya’s profits next year. Having a full paid capital stock of $505 million, Bank Asya’s market value is $953 million. The bank has recently adopted new strategies to use its capital effectively. One of them was to minimize the share of non-cash loans in total loan portfolios, Çelik explained, adding that lending these types of loans was relatively more risky. “We wanted to focus more on mortgages and small- and medium-sized business (SME) loans.” The bank’s net profits declined by 15.8 percent in the first half from the same months of 2010 and reached $58 million. Noting that they expected the growth in profits in the final two quarters to continue at a slow speed, Çelik says the government’s decision to restrict bank loans to curb the current account deficit (CAD) was right in place. The government had earlier set the target for an increase in bank loans by as much as 20 to 25 percent for 2011. As it is limiting a loan expansion in the market, the government hopes to bar any possible increase in loan defaults and to minimize a widening CAD. Source : http://www.todayszaman.com/news-254215-turkeys-bank-asya-considers-acquiring-a-balkan-bank.html - Aug 18, 2011 |
