February 4, 2015

Turkish state fund takes over Bank Asya’s management, claims lack of transparency

Turkey's state-run Savings Deposits Insurance Fund (TMSF) has taken over most of Bank Asya's management, Turkey's biggest Islamic lender, as part of the government-orchestrated crackdown on institutions affiliated with the Gülen movement.

On Tuesday, the Banking Regulation and Supervision Agency (BDDK) has decided to take over 63 percent of the bank's management and appointed a new board of directors. The banking watchdog claimed that the bank violated the conditions that it should maintain transparent and open partnership structure and organizational scheme."

Bank Asya, founded by Turkish Islamic scholar Fethullah Gülen sympathizers, has seen depositors including state-owned firms and institutions withdraw funds this year in what it has described as a systematic campaign to undermine it.

Pro-government newspapers carried almost daily reports on Bank Asya's woes earlier last year, portraying it as a failing bank being propped up by members of Gülen movement.

The government canceled tax collection and social security payment contracts with Bank Asya in August.

The BDDK said the violation of the transparency principle prevented it to effectively inspect the bank.

Turkish President Recep Tayyip Erdoğan has in several occasions expressed defamatory remarks about the bank, accusing it of having bad financials, and even once claiming that the bank has already sank.

Having one of the best capital adequacy rates in the sector, Bank Asya has rejected such assertions. It is a crime to talk about a bank in a way that may shake its prestige or cause a loss of confidence in it.

Published on Today's Zaman, 03 February 2015, Tuesday