BANKING - REGULATIONS - Gold under the mattress

www.bne.eu - News that Turkey's banking regulator BDDK has drafted regulations that will allow banks to sell all kinds of gold has been greeted with anger by Turkey's jewellers, who have until now held a near monopoly on the trade, and with surprise by those unfamiliar with the "unorthodox" monetary policy being implemented by the Turkish central bank.

While the draft regulation allowing banks to sell gold is new, it is a natural extension of existing regulations brought in last year that allow banks to buy gold. This sudden move to allow Turkish banks to trade in what many would regard as a luxury item having no relation to the business of banking reflects the twin realities of Turkey's still developing financial services sector and the central bank's ongoing "unorthodox" monetary policy.   (source)

BANKING - Islamic participation banks earn $450 mln in profit in 2011

www.todayszaman.com - Participation banks, which refrain from being involved in financial activities deemed forbidden in Islamic teaching, increased their profit by 6 percent, to TL 850 million ($450 million), in 2011 compared to 2010.

According to a statement released by the Participation Banks Association (TKBB) on Monday, the financial institutions' assets and equity capital have also grown by 29 percent and 13 percent, respectively, year-on-year to TL 56 billion and TL 6.1 billion. Their assets were only TL 3.9 billion in 2003. (source)

FINANCE - İstanbul’s bid to become IFC looks cloudy as progress continues to delay

www.todayszaman.com - The hope that İstanbul will become an international financial center (IFC) in the near future has been disappearing as progress on the project has been slow in many respects.

 

The long-overdue project has been talked about for years by many politicians and has remained music to the ears of society. In 2007, the ruling Justice and Development Party (AK Party) government set about developing İstanbul into an IFC as one of its major long-term economic goals. Steps taken by the current ruling party has many ordinary citizens believing it would be accomplished; however, some experts argue that the achievement of such a goal in the near future is a dream due to a lack of necessary policies and regulations. (source)

BANKING - The project to turn Turkey’s megacity into an international finance center is coming to fruition

www.balkans.com - Zaman - The project to turn Turkey’s megacity into an international finance center is coming to fruition as the planning phase gives way to construction. Within the framework devised by the Turkish government, the Istanbul Financial Center (IFC) project will house the head offices of the country’s governing bodies of financial markets, state-owned banks and related businesses.  (source)

BANKING - More Arab banks eye local chances : Bank Audi first .. Dubai Islamic Bank to follow ?

Interest by Gulf lenders in Turkey’s Islamic banking market is on the rise, according to Adnan Ahmed Yusuf Abdulmalek, head of Union of Arab Banks

A customer walks past the main entrance of Bank Audi head office in Beirut. The lender owned by the Lebananese Sal-Audi Saradar Group has been the only foreign bank granted license to operate in Turkey in the last 14 years. (source)

BANKING - Bank Audi to invest $10 billion in Turkey - with Islamic branch in Egypt

Lebanon's Bank Audi has informed the Banking Regulation and Supervision Agency (BDDK) that it plans to invest $10 billion in Turkey, according to reports in the Turkish media over the weekend. (source)

CREDIT CARDS - Cash ban starts in Turkey after new rules

Cash ban applies to credit card users unable to pay 50 pct of debts for 3 months.

Hundreds of thousands of consumers in Turkey have been forbidden from withdrawing cash unless they pay off some of their debt, according to new rules from the Banking Regulation and Supervision Agency (BDDK).  (source)

BANKING - ‘Gulf participation banks looking for opportunities in Turkey’

Turkish Association of Participation Banks (TKBB) Chairman and the head of Albaraka Türk Participation Bank Fahrettin Yahşi has said there are investors from the Gulf region that intend to start up participation banks in Turkey. (source)

BANKING - Limiting credit card installments not expected to reduce private spending

Experts say decreasing the number of credit card installments to 12 months will not prevent consumers from overspending as they will seek new ways to finance their planned expenditures.

The rapid growth Turkey achieved last year -- though a strong sign of the Turkish economy’s resilience against external shocks at a time of global uncertainties -- resulted in a current account deficit (CAD) of almost TL 49 billion ($30.8 billion) that was mainly triggered by massive energy imports and loan expansion. (source)

BANKING - Bank Asya: Global crisis contributed to participation banks’ prestige

Bank Asya General Manager Abdullah Çelik

The global financial crisis, which has troubled almost all nations around the world for the past two years, has helped Islamic participation banking gain more prestige worldwide, the top executive of Bank Asya, Turkey’s leading participation bank, said on Thursday. (full story - todays zaman)

BANKING - Market share of participation banks on the rise in Turkey

Bank Asya General Manager Abdullah Çelik - Al Baraka General Manager Fahrettin Yahşi - Kuveyt Türk General Manager Ufuk Uyan

Participation banks, which once were snubbed and had doubts cast over them when they first made an appearance in the Turkish financial system, have grown 10 times on average in the last eight years, according to data provided to the Aksiyon weekly by senior executives in the sector.

According to a report prepared by the late Dr. Adnan Büyükdeniz, who was the general manager of Albaraka Türk, one of the first participation banks to launch operations in Turkey, in 1985, the development of money and capital markets in developing countries is impeded by a number of factors including an underdevelopment of financial institutions and a lack of diversity of institutions and instruments. This problem is even more acute in countries where a segment of society prefers not to engage in the conventional interest-based banking system for various reasons. As a result, there is a leakage of savings from the financial system, and savings funds are often placed in unproductive areas. (full story)

BANKING - Bank Asya new CEO - Abdullah Celik

Bank Asya'dan yapılan yazılı açıklamada Cemil Özdemir'in, genel müdürlük ve Yönetim Kurulu üyeliği görevlerinden kendi isteğiyle ayrıldığı, bunun üzerine, genel müdürlük görevine Türkiye Kalkınma Bankası AŞ Yönetim Kurulu başkanlığı ve genel müdürlüğü görevlerini ifa etmiş olan Abdullah Çelik'in atanmasına ilişkin Bankacılık Düzenleme ve Denetleme Kurumu'na (BDDK) başvuruda bulunulmasına Bank Asya Yönetim Kurulu'nca karar verildiği bildirildi.(full story)

Bank Asya Board of Directors decided to assign Mr. Abdullah ÇELİK as a board member and apply BRSA (Banking Regulation and Supervision Agency) to appoint Mr. Abdullah ÇELİK as a President & CEO accordance with relevant article of Turkish Banking Law due to resignation of Board member and President-CEO Mr. Cemil ÖZDEMİR as of March 10, 2011. (source)

FINANCE - Middle Eastern lenders discuss union

'We hope that the outcome of this conference will leave concrete milestones and a timeline for us to integrate the financial systems,' says Faris Sharaf, the Jordanian Central Bank governor.

Turkish Central Bank Gov. Durmuş Yılmaz called on Turkish lenders to invest in the Middle East to grow their businesses, while making a significant contribution to the banking systems of the region’s countries in the meantime.

Speaking on the first day of the “ShamGen Banking” meeting, an event hosted by Turkey’s Central Bank to discuss opportunities among Turkey, Syria, Lebanon and Jordan, Yılmaz said Turkey paved the way for cooperation for the entire region with its policy of “zero problems with neighbors.” (full story)

CAPITAL MARKETS - US to support İstanbul’s int’l finance center bid

US President Barack Obama’s administration will lend support to İstanbul to help it become an international finance center, according to a joint statement released following a meeting of the Turkey-US Economic Partnership Commission in Washington, D.C., on Thursday. (source)

CAPITAL MARKETS - BMD - Fund manager sees tough year for Turkish banking

Avsar Sungurlu

By MUSHTAK PARKER | ARAB NEWS

Published: Feb 6, 2011 23:08 Updated:Feb 6, 2011 23:11

This year will be a difficult year for Turkish banking — both conventional and participation (Islamic) banking — although the latter will continue to grow in terms of market share of the total banking sector, says Avsar Sungurlu, assistant managing director of BMD Securities, one of the top fund managers and investment advisers serving the participation banking sector in Turkey. (source)

BANKING - Turkish Albaraka Türk, Bank Asya to open branches in N.Iraq

Two more Turkish banks have made arrangements to open branches in the northern Iraqi city of Arbil.

Following Ziraat Bankası, Vakıfbank and İş Bankası, Albaraka Türk and Bank Asya -- two leading participation banks in Turkey -- are making final preparations for their yet-to-be-opened offices in the city. (source)

FINANCE - Turkish banks to electronically transfer gold

İstanbul Gold Exchange (İAB) Chairman Osman Saraç has said they are working on a project enabling Turkish banks to transfer gold between accounts.(source)

FINANCE - PM Erdoğan says İMKB may be moved to new finance center

PM Erdoğan speaks during the 5th anniversary meeting of the foundation of the İMKB. He said they are considering moving the bourse to a new location in İstanbul.

BANKING - Turkey: Good growth so far in 4Q10 for the Banking sector - better spread formation is likely (and Participation Banks outperforming the sector again)

The BRSA (banking watchdog) released 26 November 2010 data for the banking sector. We have observed strong growth rates both in loans (4.8% qtd) and deposits (3.5% qtd) in 4Q10 so far following the end of 3Q10. YtD lending expansion stood at 26.5% as end of November, so that the annual loan growth in 2010 will be around 30% in the sector.

So far in 4Q10, corporate & commercial loans grew faster with 5.4% compared to the headline loan growth, which also calls for some drop in net interest margin (NIM) of the banking sector, as corporate loans are relatively lower yielding with respect to the other business lines. Other than the 1.3% qtd growth in credit card loans, the growth in consumer loans remained strong at 5.1% qtd, bringing the ytd consumer loan growth to over 32%.

BANKING - (Participation) Banks not to distribute dividends without prior permission

The banking watchdog has sent new guidelines to Turkish banks, which managed to post extraordinarily high profits thanks to strict discipline at a time when the banking sectors of the rest of the world were struggling to survive amidst harsh losses.

The Banking Regulation and Supervision Agency (BDDK) sent an official notice to the Turkish Banks Association (TBB) and the Turkish Participation Bank Association (TKBB) to retain a cautious stance while distributing dividends for 2010 to shareholders and instead keep the profits as contingency reserves, given that the dark clouds over the financial system have not yet dispersed completely.