Turkey bans brokerage firm, moves to sell bailed out banks
Turkey's banking watchdog on Saturday, February 10, shut down a troubled brokerage firm and announced procedures for the sale of two bailed out banks as part of a drive to reform the country's ailing financial sector.
The banking regulation and supervision board said it had barred the medium-sized Ihlas brokerage from operating because it failed to fulfil its financial obligations and resolve its liquidity problems due to mismanagement, posing a threat to the interests of its clients. Under Turkish law, the board will not give any guarantees to creditors of Ihlas, part of a prominent holding that also owns insurance companies and a media group, the statement said.
The board also invited bids until February 26 for the sale of Etibank, which was bailed out in October, adding that the tender would be completed in mid-May. It also announced that five investors, two of them foreign bidders, had applied to buy another bailed out institution, Demirbank, which was rescued in December after failing to overcome a severe liquidity crunch.
It said the bidders will be allowed to carry out due diligence in the bank, without specifying a date for the finalization of the sale.
A total of 11 banks have been bailed out in the past two years in Turkey's crowded and weak financial sector of 80 banks. Ankara has recently stepped up its efforts to reform the sector, after a severe liquidity crisis erupted last December and battered the country's money markets, prompting the International Monetary Fund to release rescue aid of about $10 billion. —(AFP)
© Agence France Presse 2000
© 2001 Mena Report (www.menareport.com)