3 Nisan 2011 Pazar

Turkey-Greece bank mergers one-way street

Anatolian News Agency

The head of Turkey’s biggest state lender says Greek politics are not ready to welcome a Turkish bank acquiring a Greek lender despite the fact that the National Bank of Greece has been continuing operations in Turkey with its Finansbank subsidiary and more that 500 branches. Ziraat Bank will choose to grow with new branches on the other side of the Aegean, instead of acquiring a bank, the general manager says

Turkish banks in Greece do not enjoy the “kind reception” that the National Bank of Greece, or NBG, experiences in Turkey, according to Can Akın Çağlar, the general manager of Ziraat Bank, the state-run Turkish lender that also has operations in the neighboring country.

“Our existence in Greece is questioned at the Greek parliament almost every day,” he told the Anatolia news agency during his visit to northern Iraq’s Arbil, where he went for an opening ceremony of a new branch last week. “We are worried that if we go and buy a Greek bank, we will not receive the kind reception seen when Finansbank was sold to NBG.”

NBG entered the Turkish market by purchasing Finansbank in August 2006.

“We were deeply interested in Greece. We thought we could open branches or acquire a bank there,” he said. “Questions claiming that we were trying to capture the sugar market there were submitted to the parliament. The existence of our three assets was driven into the parliament’s agenda with an urban-legend assertion that we were trying to seize Greek land via cheap credit. Our assets are in Athens, Komotini and Xanthi. They are worried about these three branches, whose assets do not exceed one-10th of our branch in Kızılay [in the Turkish capital of Ankara].”

Noting that Ziraat Bank opened its first branch abroad 47 years ago, Çağlar said: “Our new strategy may be taking bigger steps by acquiring banks. But is it possible in Greece? It is a question mark from now on.”
Despite some rumors, no written questions have been submitted to Turkish Parliament on the activities of Finansbank in Turkey, the general manager said. “As all our activities [in Greece] are questioned and watched, in order to avoid further reactions, we want to keep up with our branch-opening strategy there,” he said. “But we do not have a strategy to withdraw, because nothing we do is against Greek legislation.”
A total of 77.22 percent of Finansbank shares are held by NBG, in addition to a 7.9 percent by NBG Holdings B.V and another 9.68 percent by NBG Finance.

Even if Ziraat Bank had found a good investment opportunity in Greece, it would hesitate on a possible acquisition due to the approach of Ziraat Bank in Greece, the general manager said.
Turkish banks are welcomed in other Balkan countries such as Bosnia and Herzegovina, Kosovo, Albania and Bulgaria, Çağlar added, noting that his bank has already decided to open two branches in two Kosovar cities, Prizren and Pristina.

Ziraat is the Turkish lender with the broadest service network abroad as it operates at 26 points in 17 countries, he said.

Ziraat may take over Halkbank branches
Noting that his bank has been active in Germany for 47 years, Çağlar said Halkbank, another state bank, has recently decided to close its three financial services branches there. “Maybe we can take over these branches. Our contacts are continuing.

“Our bank in Germany is a German bank. It is granted all the authorizations. It can use all the financial instruments there. We were thinking of growing in this country in more adequate locations. And when Halkbank said, ‘We do not want to be there any more,’ we started negotiations for buying their branches. Everything will become certain soon.”

Loan size shrinks
Commenting on the Turkish Central Bank’s latest moves to control the credit volumes of lenders, Ziraat Bank General Manager Can Akın Çağlar said his bank was free from criticism as the sector grew 4.6 percent by the end of February when compared with 2010, but loans provided by Ziraat shrank 1.9 percent in the same period.

Turkey’s Central Bank increased the required reserve ratio for one-month deposits to 15 percent from 10 percent on March 23 in a bid to cool down the economy and decrease the country’s alarming current account deficit that is forecast to hit 7 percent of gross domestic product.

There are many ways to hit the brakes in banking, and Ziraat has chosen to cool marketing and focus on processes by its current customers, he said.

It is only the agricultural credits that the bank will find it difficult to slow down, the general manager said.
“We are moving forward in agricultural credits anyway.”

Ziraat is the bank that provides the highest amount of individual loans in Turkey, Çağlar said.

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