Bank Asya seized by Turkish state-fund, drawing reaction

ISTANBUL / ANKARA

CİHAN Photo

Turkey’s state run Savings Deposit Insurance Fund (TMSF) has seized control of Bank Asya, the participation bank at odds with the government due to its links with U.S.-based Islamic scholar Fethullah Gülen, with leading government figures defending the move.

The TMSF took over the management of Bank Asya and took control of 63 percent of its privileged shares, enough to determine the board, late on Feb. 3. All new board members, a general manager and deputy general managers were appointed immediately.

Turkey’s banking watchdog, the BDDK, stated after the seizure that Bank Asya’s former board did not act transparently during recent inspections on the structure of its partnership, failing to submit documents on privileged shareholders. The TMSF seized the bank upon the BDDK’s call.

“There is nothing political behind the decision,” claimed Deputy Prime Minister Numan Kurtulmuş, while commenting on the move at a meeting with entrepreneurs in Ankara on Feb. 4.

“I wish Bank Asya had fulfilled the technical requirements. But it was obvious from the start that things would come to this stage,” he added.

Kurtulmuş also said this was “not a seizure, but rather a technical process to protect investors.”

Meanwhile, Economy Minister Nihat Zeybekci claimed that the seizure of Bank Asya ended speculations in the financial markets and promised a “more secure atmosphere.”

“There is nothing to comment on concerning the decision, it is all about mathematical assessments. What had to be done has been done,” Zeybekci said.

Yiğit Bulut, advisor to President Recep Tayyip Erdoğan, stated in a televised interview that the seizure brought to an end a long-debated issue.

“Bank Asya has victimized hundreds of thousands of small investors,” Bulut said, accusing the bank of favoritism.

However, deputies from Turkey’s opposition parties have responded to the TMSF’s seizure differently.

“All banks seized by the BDDK and the TMSF have gone bankrupt so far,” said Mahmut Tanal, an Istanbul deputy for the main opposition Republican People’s Party (CHP), describing Bank Asya’s seizure as “politically motivated.”

Nationalist Movement Party (MHP) deputy Kemalettin Yılmaz criticized the timing of the move, as it came late at night. “I think this will result in the corrosion of the banking sector, both in Turkey and abroad,” Yılmaz said.

Bank Asya has been subject to a “smear campaign” for more than a year, according to Ahmet Beyaz, the general manager who was removed from his post on Feb. 3.

In addition, many economists wrote on their social media accounts that the government had targeted the bank for political reasons. 

Meanwhile, a small group of people staged a protest in support of the bank in front of its HQ in Istanbul late on Feb. 3, while police were inside the building.

Other groups staged protests in front of Bank Asya’s branches in a number of different cities, depositing money at the lender’s teller machines in support.

Officials have said deposits of under 100,000 Turkish Liras are under state guarantee, due to Turkey’s banking code.

Bank Asya was founded by followers of Gülen in 1996. One close allies, the government and President Erdoğan now accuse the Gülen movement of staging a coup attempt through Turkey’s largest ever graft probe, which broke in December 2013.

The bank said in November 2014 that its third quarter losses stood at 301 million liras, its first quarter without profits since going public in 2006.