Published On: Mon, Jan 8th, 2018

A quick overview of the Turkish banking sector in 2017

A quick overview of the Turkish banking sector in 2017

Banking Sector in Turkey (İş Bank Building) –

Turkish Banking Sector which has become much stronger and robust since the crisis in 2000-2001 survived the global crisis in 2008 with almost no damage. Thanks to the measures taken by the administration thereafter, the banking sector in Turkey has gained strength.

As for the outlook of the sector by the end of 2017 the industry has grown to a worth of TL 3 trillion in terms of total asset value despite a decline in the number of branches and employees.

The sector which had a worth of TL 2.5 trillion in the first nine months of last year has continued to grow and reached an asset value of TL 3 trillion 54 billion by the end of third quarter of the year.

Credits, the largest assets item, increased by 15 percent year on year to TL 1 trillion 994 billion. Total securities also increased by 6.9 percent to TL 376 billion.

However, the number of banks, branches and employees in the sector has declined. As of September 2017, there are 51 banks including 33 deposits, 13 development and investment and 5 participation banks. These banks serve with 11 thousand 663 branches, 209 thousand 672 personnel. In the same period last year, 52 banks with 11 thousand 926 branches and 211 thousand 673 employees were operating.

The total amount of the loans provided by the banking sector in September 2017 was TL 1 trillion 994 billion. This total consists of 1 trillion 356 billion TL as Turkish Lira loans and 638 billion TL as foreign currency loans. In the same period, commercial and corporate loans amounted to TL 1 trillion 22 billion, SME loans amounted to TL 498 billion and consumer loans and credit cards amounted to TL 474 billion. When compared to 2016, the increase in volume of commercial and corporate loans was 14 percent the increase in volume of SME loans was 18 percent while the increase in volume of consumer loans and credit cards increased by 12 percent.

In 2017, the largest amount of loans were used by medium-sized businesses totaling up to TL 207,2 billion with an increase of 21 percent. On the other hand, the amount of loans borrowed by small businesses was TL 163 billion, while the amount borrowed by micro-enterprises was TL 127 billion.

Demand for individual loans is observed to have increased by 17 percent compared to 2016. Of the 474 billion TL individual loans used, 40 percent were made up of need loans. The share of housing loans in individual loans was 40 percent, the share of credit cards was 19 percent, and the share of vehicle loans was 1 percent.

The amount of follow-on loans of 59 million TL at the end of 2016, reached 63 billion TL according to the results of the third quarter of 2017. The 3.24 percent conversion rate in 2016, which represents the highest level of subordinated loans since 2010, declined to 3.05 percent in 2017.

It is also observed that usage of internet banking is increasing. In 2010, 6.7 million users were using internet banking whereas in 2017, a figure of 32 million was recorded corresponding to 6.7 million users. The increase in the number of customers using this service in the last seven years is 380 percent.


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