Turkey Moving Its Financial Institutions to Istanbul

State lender Vakıfbank starts moving its nearly half-century-old headquarters from the capital city of Ankara to Istanbul, the heart of business in the country. The Central Bank, the Banking Regulation and Supervision Agency and the Capital Markets Board are set to follow within the scope of a broader plan to bring the country’s key finance institutions to Istanbul.

Turkey’s state-owned lender Vakıfbank, established in the capital city of Ankara in 1954, is set to move its headquarters to Istanbul, a concrete step in moving the country’s financial institutions to its business center.

Vakıfbank will start to gradually move its head office and units to Istanbul as of Monday, Süleyman Kalkan, the bank’s director-general, told the Anatolia news agency. “The bank’s movement process will take three years,” Kalkan said.“Vakıfbank has been conducting studies for many years to not remain distant from the competition and to have a place in the center of finance. We have focused this issue in the last year and decided to move our head office to Istanbul,” he added.

The head office of the bank will be in Levent, a district on the European side of Istanbul, according to Kalkan. “In the upcoming period, we plan to have a place in the city’s finance hub to be established in Ataşehir, a district on the Anatolian side,” he said.

Noting that a total of 2,200 people currently work in units a the bank’s head office, Kalkan said the first phase of the movement process will see a total of 337 people relocated to Istanbul as of Jan. 18, 2012.

Banking and marketing units will continue offering services in Istanbul, while operation and support departments will stay in Ankara, according to Kalkan.

In the first phase of the movement process, personal banking, personal loans, treasury, private banking, corporate loans, commercial loans, investment banking, corporate communication, head office of legal consultancy and units related to the board of directors will move to Istanbul, Kalkan said.

“We had talks with our employees concerning the movement of the bank and we received their support. To help our employees, we make special agreements with transportation companies. We will also offer rental assistance for two years,” he added.

İşbank moved in 2000

Turkey’s biggest publicly traded lender, İşbank, moved to Istanbul from the capital city in 2000. Ersin Özince, former chief executive officer of İşbank, told journalists in February that if there was a possibility to go to the center of Europe, they would move the head office of İşbank there. “We all should do what the competition requires,” the Doğan news agency, or DHA, quoted Özince as saying. “If we did not move İşbank to Istanbul from Ankara, we would not have kept up with the competition.”

The project revealed to transform Istanbul into an international finance hub has accelerated the movement process of some state banks and institutions that have their headquarters in Ankara.

The movement of Turkey’s Central Bank, the Banking Regulation and Supervision Agency, or BDDK, and the Capital Markets Board, or SPK, to Istanbul is another issue that has been on the agenda for a long time.

Even though the movement decision of the BDDK and SPK to Istanbul is finalized within the scope of an omnibus law enacted earlier this year, there have been no concrete developments in the issue.

According to the law, the movement process of the BDDK and SPK will be completed in two years and the Cabinet will be able to extend the time, daily Milliyet reported in January this year.

The movement of SPK to Istanbul is important to be able to foresee possible crisis, according to Vedat Akgiray, chairman of the SPK. “Those who attach importance to markets should observe it on site,” Milliyet had quoted Akgiray as saying.

Noting that most of their businesses are in Istanbul, Akgiray said going to Istanbul from Ankara for each work is costly. “Being in the finance world is important. Our 150 employees currently work in Istanbul and 400 workers in Ankara,” Akgiray told journalists before the enactment of the omnibus law.

In addition to the movement of BDDK and SPK, Turkish Prime Minister Recep Tayyip Erdoğan called on the Istanbul Stock Exchange, or ISE, to move to the Ataşehir district, which is planned to be an international finance hub.

“This project cannot be postponed,” PM Erdoğan had said in December last year. “The year 2011 will be the year that we take these steps. All centers will be completed within the next two to three years,” Milliyet quoted. “While Istanbul is transforming into a finance hub, I believe that the ISE will have a better international identity and will announce a stronger Turkish economy to the world.”

With the movement of these institutions, some 10,000 workers are expected to come to Istanbul. According to data gathered by Milliyet, a total of 4,403 employees from the Central Bank, 365 people from the BDDK, 550 workers from the SPK, 2,200 bankers from Vakıfbank, 900 people from state-run Halkbank, 352 bankers from the Development Bank of Turkey and 1,750 bankers from Turkey’s biggest state lender Ziraat Bank are forecasted to move to Istanbul.

April 17, 2011
SOURCE: HURRIYET DAILY NEWS