Turkish banks record profits decline
Posted by meb at August 7th, 2008
Garanti Bank reported second-quarter profit declined after year-earlier results were boosted by the sale of the bank’s two insurance units. Net income dropped by 51 percent from a year earlier to YTL 534.9 million ($463 million). The figure was calculated by subtracting first-quarter profit from the YTL 1.03 billion of first-half net income Garanti announced yesterday.
The sale of insurance units helped boost last year’s second-quarter profit to YTL 1.09 billion. A year ago, the bank gained YTL 782.2 million from “other activities,” which included the sale. Excluding the insurance units’ sale, Garanti’s first-half profit rose 21 percent from the previous year, the bank said.
Garanti’s loan book grew 5.2 percent in the quarter to YTL 47.7 billion. That compares with overall growth of about 8 percent in Turkish bank lending in the second quarter, down from 11 percent three months earlier.
Turkey’s largest bank by market value Akbank may also see its second-quarter profit fall by 40 percent, after gains from tax rebates last year were not repeated. Akbank’s net income was YTL 454 million ($393 million), compared to YTL 752.9 million a year earlier, according to the average estimate of 11 analysts surveyed by Bloomberg. Akbank recorded YTL 270 million rebate from its 2002 tax bill in the April to June period of last year. Lending growth also slowed at Akbank in the quarter, after the central bank raised benchmark interest rates.
Yapı Kredi Bank may say its second-quarter profit narrowed because of increased costs as it expands its branch network to lift revenue. Net income probably fell to 239 million liras ($207 million) from YTL 498.1 million in the same period last year, according to the average of 10 estimates compiled by Bloomberg. Yapı Kredi has spent money to add branches and grab market share from other Turkish lenders such as Akbank. Yapı Kredi’s branch numbers rose 17 percent in the first six months of the year. “Rapid expansion naturally raises costs, and this will reflect on the bottom line until these branches start earning a profit in 2009 or 2010, when the expansion is complete,” said Mete Yüksel, an analyst at EFG Securities in Istanbul.
source: Turkish Daily News
Related posts: