Leading Turkish Islamic lender Bank Asya's operations are continuing "healthily" and its capital adequacy ratio stands at 18.32 percent, above the market average, the bank said in a statement on Tuesday.
The bank's capital adequacy ratio was 14.3 percent at the end of 2013.
The statement comes on the heels of earlier comments in government media outlets that the Islamic lender was having serious troubles due to deposit withdrawals and that it had to close some branches across Turkey. The bank saw a net loss of TL 301 million ($133 million) in the third quarter, it said in a filing to Borsa İstanbul (BİST) on Tuesday.
Bank Asya, which has more than 1 million deposit-holding customers and 282 branches, said in its statement on Tuesday that its total assets have hit TL 16.5 billion and the size of loans provided by the bank have reached TL 20.3 billion. “We have a strong capital structure and all our branches and employees continue to carry out operations as healthily as before,” the bank's CEO, Ahmet Beyaz, said in the written statement on Tuesday.
Bank Asya's net loss in the third quarter was due to higher loan provisions as it sought to increase its asset quality, Tuesday's statement read. The Islamic lender's assets fell 40 percent to TL 16.5 billion at the end of the third quarter from the end of 2013, while deposits almost halved to 10.07 billion over the nine-month period, the same filing showed.
As part of a campaign encouraged publicly by President Recep Tayyip Erdoğan and promoted by government media to hurt Bank Asya's market standing, state-owned firms and institutional depositors loyal to Erdoğan withdrew their assets from the bank. The government canceled tax collection and social security payment contracts with Bank Asya while government newspapers have carried almost daily reports on Bank Asya's woes, portraying it as a failing bank.
Earlier in September, Beyaz said: "This bank is based on a very solid foundation. Some people may have withdrawn deposits, but others have come to us." He added that most of the bank's customers were ignoring the smear campaign.
Published on Today's Zaman, 11 November 2014, Tuesday
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