Eurobank Tekfen keeps an eye on the big picture
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Anatolia News Agency
Oluşturulma Tarihi: Mart 20, 2009 00:00
ISTANBUL - Eurobank Tekfen becomes the latest lender in Turkey to post strong results for the past year. The bank, in which Eurobank EFGholds a 70 percent stake, reports 40.1 million Turkish Liras as net profit. Despite a heavy economic slowdown, the bank increased its staff from 609 to 744 in the period. Eurobank Tekfen also strengthened its capital base
Eurobank Tekfen, in which Eurobank EFG holds a 70 percent stake, reported a net profit of nearly 40.1 million Turkish Liras for 2008.
The past year has been marked as a year of growth for Eurobank Tekfen, said Mehmet Sönmez, the bank’s general manager, at a news conference Tuesday. With the addition of six new branches, the number of Eurobank Tekfen branches rose to 42 last year, he said. The rising number of personnel also contributed to the bank’s growth. The number of employees at the bank rose 22 percent to 744 from 609 last year.
The bank raised a total capital of 150 million liras last year. It also raised the amount of its paid-in capital to 380 million liras from an earlier 230 million liras. Eurobank Tekfen is the country’s strongest bank in terms of capital, according to Sönmez. The bank’s end of the year capital adequacy ratio stood at 15.94, he said.
Rising assets
The bank’s total assets rose 27.8 percent to 3.58 million liras last year, while the total of credits added up to 1.23 million liras, with an increase of 31.5 percent. Eurobank Tekfen’s deposits rose 49.6 percent to 1.12 million liras, while its equities amounted to 305.5 million, with an increase of 10.4 percent. Eurobank Tekfen ended the year with a net profit of nearly 40.1 million liras, Sönmez said.
"In the long term, we aim to increase our market share and place ourselves among the country’s medium-sized banks," said Sönmez. In order to realize that goal, Eurobank Tekfen will first focus on transforming some of its existing branches into more complex branches that can provide commercial banking and retail banking services, Sönmez said. The bank aims to open new branches that will focus on commercial and retail banking during the last quarter of the year, he added.
Turkey’s banking industry had strong balance sheets when the markets were hit by the global economic crisis, said Mehmet Erten, Eurobank Tekfen board chairman. "The experience obtained during the economic crisis that hit the country in 2001 had a lot to do with that."
Banking Regulation and Supervision Agency, or BDDK, and the Central Bank were active and took the necessary measures as quickly as possible, he said. What is troubling is the delay in the measures that needed to be taken to protect the country’s real economy, Erten added. "Some precautions could have been taken earlier. Measures will eventually ease the markets. A possible stand-by loan deal with International Monetary Fund would definitely be the cornerstone to help establish an environment of confidence."
Once the biggest troubles in the country were the current account deficit and inflation. Growing unemployment and dropping domestic demand are now superseding these problems, according to Erten. Economic units are rather slow and hesitant in making decisions, he said, adding that there is a grave need for an environment of confidence.
The growth of the banking industry will slow down a little, but it will obtain a great profit during the first quarter of the year, said Erten. "However we shall all remain precautious." Erten also highlighted the importance of maintaining the quality of assets and prolonging credit activity. Credits should be managed very carefully," he said.
Erten said that restructuring the real economy could also be a good idea. "Following the 2001 economic crisis, Turkey’s entire banking industry was restructured. The real economy may also benefit from a restructuring in this climate of crisis. This may actually present an opportunity for the industry’s adaptation to international norms," Erten said.
Banks will also assume an important role, he said. "Risk management terms will be revamped and more controlled. The government will play a more active role both in the real economy and the finance sector. Some of the structural measures that have been neglected for a long time will have to be taken."
The past year has been marked as a year of growth for Eurobank Tekfen, said Mehmet Sönmez, the bank’s general manager, at a news conference Tuesday. With the addition of six new branches, the number of Eurobank Tekfen branches rose to 42 last year, he said. The rising number of personnel also contributed to the bank’s growth. The number of employees at the bank rose 22 percent to 744 from 609 last year.
The bank raised a total capital of 150 million liras last year. It also raised the amount of its paid-in capital to 380 million liras from an earlier 230 million liras. Eurobank Tekfen is the country’s strongest bank in terms of capital, according to Sönmez. The bank’s end of the year capital adequacy ratio stood at 15.94, he said.
Rising assets
The bank’s total assets rose 27.8 percent to 3.58 million liras last year, while the total of credits added up to 1.23 million liras, with an increase of 31.5 percent. Eurobank Tekfen’s deposits rose 49.6 percent to 1.12 million liras, while its equities amounted to 305.5 million, with an increase of 10.4 percent. Eurobank Tekfen ended the year with a net profit of nearly 40.1 million liras, Sönmez said.
"In the long term, we aim to increase our market share and place ourselves among the country’s medium-sized banks," said Sönmez. In order to realize that goal, Eurobank Tekfen will first focus on transforming some of its existing branches into more complex branches that can provide commercial banking and retail banking services, Sönmez said. The bank aims to open new branches that will focus on commercial and retail banking during the last quarter of the year, he added.
Turkey’s banking industry had strong balance sheets when the markets were hit by the global economic crisis, said Mehmet Erten, Eurobank Tekfen board chairman. "The experience obtained during the economic crisis that hit the country in 2001 had a lot to do with that."
Banking Regulation and Supervision Agency, or BDDK, and the Central Bank were active and took the necessary measures as quickly as possible, he said. What is troubling is the delay in the measures that needed to be taken to protect the country’s real economy, Erten added. "Some precautions could have been taken earlier. Measures will eventually ease the markets. A possible stand-by loan deal with International Monetary Fund would definitely be the cornerstone to help establish an environment of confidence."
Once the biggest troubles in the country were the current account deficit and inflation. Growing unemployment and dropping domestic demand are now superseding these problems, according to Erten. Economic units are rather slow and hesitant in making decisions, he said, adding that there is a grave need for an environment of confidence.
The growth of the banking industry will slow down a little, but it will obtain a great profit during the first quarter of the year, said Erten. "However we shall all remain precautious." Erten also highlighted the importance of maintaining the quality of assets and prolonging credit activity. Credits should be managed very carefully," he said.
Erten said that restructuring the real economy could also be a good idea. "Following the 2001 economic crisis, Turkey’s entire banking industry was restructured. The real economy may also benefit from a restructuring in this climate of crisis. This may actually present an opportunity for the industry’s adaptation to international norms," Erten said.
Banks will also assume an important role, he said. "Risk management terms will be revamped and more controlled. The government will play a more active role both in the real economy and the finance sector. Some of the structural measures that have been neglected for a long time will have to be taken."