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AKBANK T.A.S.

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End-of-day quote BORSA ISTANBUL  -  2022-08-11
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Akbank T : Turkish private lender Akbank hit with TRY156mn fine for violating ‘COVID-19' stipulations

07/17/2020 | 11:06am EDT

Turkish banking watchdog BDDK has fined Akbank, one of Turkey’s largest private banks and controlled by Turkish conglomerate Sabanci Holding, Turkish lira (TRY) 156mn ($23mn) for violating a directive aimed at limiting coronavirus (COVID-19) impacts, the lender has confirmed in a stock exchange filing.

Akbank said it would pay the fine ahead of its due date to benefit from a 25% discount. The fine will have no effect on Akbank’s next income statement, with Seker Invest expecting the lender to report TRY1.5bn in net income for Q2, up 19% y/y.

The BDDK has fined more than 20 banks and financial institutions a total of TRY330mn for carrying out transactions seen as contrary to its orders during the COVID-19 outbreak, during which the Erdogan administration has stepped up its credit-fuelling of an already fragile economy. However, the watchdog has not released the names of the institutions.

Since the beginning of May, the BDDK has announced four rounds of fines.

In May, a total of $2.84mn in fines were levied against 15 banks and 18 banks were fined a total of TRY102.1mn.

In June, the regulator fined 16 financial institutions a total of TRY2.1mn.

‘Inquiry into complaints’

The banking watchdog said on June 9 that seven banks were slapped with a TRY204.7mn overall fine, Daily Sabah reported. The announcement was actually released on July 9. “The inquiry process regarding customers’ complaints is ongoing,” the BDDK said in a statement.

The BDDK said the fines were handed down after it examined “the complaints by individual and commercial customers conveyed to our institution during the period of battling the COVID-19 outbreak”.

Sources at BDDK told government-run new service Anadolu Agency (AA) that most of the violations were categorised under 10 complaints.

The most common violation was a refusal by a bank to restructure its debts or offer repayment flexibility to individuals, who had either lost their jobs or had incurred large financial losses due to the pandemic.

Increasing effective interest rates through an interest calculation formula determined as in conflict with BDDK regulations and adding unfair terms to a contract were also among the common violations.

Banks were also fined for not allowing customers to use previously given credit limits without justifiable reasons.

The BDDK sources also said banks offering interest rates above the market level and introducing additional costs for credit were among the violations.

Banks that have put additional obstacles in the way of customers to discourage them from applying for credits were also fined for violating regulations, the sources were cited as saying.

Banks told to agree to payment delays

On July 8, the BDDK told local lenders in its latest letter of instructions that retail and commercial borrowers’ payment delay requests regarding payments until end-2020 must be agreed to.

The existing loan limits should not be blocked without justified and concrete reasons, and care should be taken to ensure loan limits were ready for use, the instructions with 11 articles also said.

The regulator has also requested the delivery of convenience as regards credit card fees and has demanded that credit card fee collections should be temporarily delayed in line with the demands of customers.

Lastly, banks’ precautionary measures in terms of restricting credit card limits and closing credit cards to cash withdrawals should not be stricter than the rules specified in the legislation, according to the watchdog.

On July 9, the BDDK released a separate ruling to increase the maximum limit for credit cards for customers who cannot declare their income to TRY2,000 from TRY1,300.

Additionally, banks will not close credit cards where the minimum payment amount is not paid three times in the calendar year until end-2020.

On July 11, President Recep Tayyip Erdogan gave authorisation to the central bank to obtain real-time data from local lenders.

The central bank, the BDDK, the SPK capital markets board and the trade ministry separately issued new regulations along with amendments to existing regulations with an impact on banking.`

The BDDK has employed a proactive perspective in introducing around 50 regulations since the beginning of the outbreak, Mehmet Ali Akben, head of the regulator, said on June 14.

His figure did not include regulations or regulatory amendments introduced by other authorities, while the overall list of regulatory forbearance instances since 2016 would deserve a PHD thesis.

Local lenders assign zero weight to their FX receivables from the Treasury and the central bank although Turkey is rated at deep junk by all rating agencies.

Moreover, they calculate their FX assets at the 2019 exchange rate and they do not write defaulted loans as non-performing loans (NPL) though they regularly restructure them.

Anxiety over “bad bank”

On July 2, Reuters quoted seven unnamed industry sources as saying that some Turkish banks are reportedly concerned that a “bad bank” plan to house billions of dollars of NPLs could require them to book large losses.

Additionally, the government announced some capital hikes at state lenders but media reports overlooked the fact that the “capital hikes” in question were performed through exchanging some government papers among the Turkey Wealth Fund (TVF), the unemployment fund and state banks.

The overriding idea is that the government wants more loan growth when it comes to both individuals and firms.

The lenders are also obliged to comply with a recently introduced “asset ratio”.

©2020 bne IntelliNews , source Magazine

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Financials
Sales 2022 84 864 M 4 727 M 4 727 M
Net income 2022 46 939 M 2 615 M 2 615 M
Net Debt 2022 - - -
P/E ratio 2022 1,17x
Yield 2022 8,98%
Capitalization 52 000 M 2 896 M 2 896 M
Capi. / Sales 2022 0,61x
Capi. / Sales 2023 0,79x
Nbr of Employees 12 716
Free-Float 59,2%
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Last Close Price 10,00 TRY
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Hakan Binbasgil Chief Executive Officer & Executive Director
Türker Tunali Chief Financial Officer
Suzan Sabanci Dinçer Executive Director-Treasury Division
N. Ilker Altintas Executive VP-Information Technology & Operations
Zakir Selim Önal Head-Compliance
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