Fitch lowers support ratings for Turkey’s Garanti Leasing and Garanti Factoring

Published December 23rd, 2003 - 02:00 GMT

Fitch Ratings has revised the Support ratings of Turkey’s Garanti Leasing and Garanti Factoring to 4 from 5. At the same time, the agency has affirmed the two companies' Long-term foreign and local currency ratings at B and their National Long-term ratings at BBB+. The Outlook on the Long-term ratings is Positive, while the Outlook on the National ratings is Stable.  


Garanti Leasing's and Garanti Factoring's primary sources of support, were they to run into difficulties, would be their shareholder, Garanti Bank, the third largest private bank in Turkey in terms of total assets. In Fitch's opinion although the propensity of support from Garanti Bank is high, the ability to do so may be limited by its own weak financial condition. Hence, the agency's Support rating is 4 for both companies.  


Garanti Leasing and Garanti Factoring are focused on small ticket business benefiting from the retail distribution capabilities of the large branch network of its parent Garanti Bank, and they are concentrated on their core businesses.  


Garanti Leasing is part of Dogus Group, a major conglomerate with interests in finance and construction, food retailing, automotives, tourism and media. At 94.10 percent, the majority of its shares are owned by Garanti Bank and 5.86 percent owned by Garanti Factoring, whereas 55.41 percent of Garanti Factoring shares are owned by Garanti Bank, 9.78 percent owned by Turk Exim Bank and 34.41 percent are listed on the Istanbul Stock Exchange.  


The group's financial activities are carried out under the brand name of Garanti. Garanti Leasing and Garanti Factoring have become more integrated into the Garanti financial group and the management teams of Garanti Leasing and Garanti Factoring have merged with the exception of specific areas where the businesses do not overlap. Both companies are able to utilize branches of Garanti Bank for sales and marketing purposes. They also benefit from the centralization of operations and IT and also from human resources and training services at the group level. — ( 



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