The government whistleblower known as Fuat Avni said on Friday on Twitter that the reasons set forth for the crackdown on Islamic lender Bank Asya were invalid according to the banking laws and in contradiction with previous statements by the banking watchdog.
Claiming that he/she obtained internal correspondence and reports about the seizure decision, Avni said one of the reasons for the decision was financial shrinkage in the bank. However, Avni added that it was regulators who had earlier ordered Asya to downsize by limiting loans.
Even though regulators had earlier asked Asya to keep its liquidity ratio strong rather than its profitability, Avni maintained the bank was seized on the pretext that the bank posted a loss in 2014.
Bank Asya posted a net loss of $336 million in 2014, but recovered in the first quarter of this year by recording some TL 13 million worth of new profit.
The most scandalous justification, the informant said, was a decline in deposit holders' confidence towards the bank.
After the Banking Regulation and Supervision Agency (BDDK) ruled that the management control of Bank Asya be handed over to the Savings Deposit Insurance Fund (TMSF) on Feb. 3, deposit holders flocked to Asya branches all across the country in a show of solidarity in a bid to save their bank. Avni earlier claimed that the intended goal was to scare off depositors and cause the bank to collapse.
In the latest of pressures on Asya, the BDDK announced on May 29 that it had handed over full control of the lender to TMSF. While the watchdog listed the articles of the banking law that Bank Asya's conditions violate, it didn't mention specific reasons for the seizure of the bank.
Avni's Friday tweets also say that regulators argue that depositors' efforts to back the lender by selling off personal properties are devoid of economic rationality. The whistleblower also claimed one of the reasons was that deterioration in Bank Asya's financial records could have endangered stability and confidence in Turkey's monetary system. However, Avni added, the BDDK earlier filed a report with the Central Bank of Turkey stating that Asya's situation poses no danger for the entire system.
The whistleblower also stressed that the BDDK seized the bank claiming Asya had been involved in political operations and thus engaged in unauthorized business. Even the auditors have not detected any political act committed by the lender but only an auditors' perception through reasonably suspicious acts.
Bank Asya is known for its ties to the faith-based Gülen or Hizmet Movement, which has been targeted for almost two years by high state officials for its alleged role in the major corruption investigations that implicated several Cabinet ministers in December of 2013.
Published on Today's Zaman, 19 June 2015, Friday