Penalty from Germany to ZIRAAT BANK following audit by banking authority

The German banking supervisory and Regulatory Board (Bafin), took very tough decisions about Ziraat Bank (Ziraat Bank International AG), the largest bank in Turkey with 7 branches in Germany based on results found out following the audits carried out in regards.

The bank (German Branch), headquartered in Frankfurt, has received severe penalties that have not been seen in history of German State.

Penalties equivalent to closing down

Justification for penalties, including a deposit restriction and a ban on giving out large loans, equivalent to closing the bank are said to be non-compliance with large loans of hundreds of millions of euros and unclear points about collecting deposits…

No approval for the general manager

Bafin, which also rejected 4 general managers sent from Turkey in turn, issued a statement. Due to confidentiality rules, the bank’s name has not been disclosed, but it is known that these penalties were issued to Ziraat Bank International AG, which was audited by BaFin some time ago.

Here are the concerned decisions

According to a reporter from SOZCU (newspaper), the decisions taken are as follows

1-Ziraat Bank AG is imposed a ban on giving “large amounts of loans”. Millions of euro loans will no longer be available in return for mortgages from Turkey.

2-In addition, the bank was prohibited from taking large amounts of deposits, giving interest rates over the market rate.

3-The Board warned the management and rejected four general managers sent by Ziraat Bank in Turkey at different times.

4-BaFin agreed on the bank’s greater use of equity in all banking transactions and demanded special material guarantees for administrative transactions.

5 – Also the bank was fined a high amount of money.

Unsupervised, unquestioned sending of money

The reasons for these penalties are said to lie in the results of the bank’s loans since 2017 and in the uncertain transfer of money to Turkey in recent years. Experts comment that these severe penalties are equivalent to closing a bank, but  the bank was not closed, so as not to have a diplomatic problem with Turkey.

Ziraat Bank International AG, the unit of Ziraat Bank in Germany, which is the largest bank in Turkey by assets, has more than 250 million euros in equity and 114 employees. The bank has branches in Germany in Berlin, Duisburg, Frankfurt, Hamburg, Hannover, Cologne and Munich.

Source: halktv.com.tr/ekonomi/almanyadan-ziraat-bankasina-tarihi-ceza-kapatilmakla-esdeger-470239h