Turkey Financial News

Posted by meb at September 17th, 2009

Turkish banking industry proves to be a high-profit business as its profit rises 33 percent to 11 billion Turkish Liras in the second quarter of the year. Although the banking industry has been displaying a great performance despite the global economic crisis, however the rising number of non-performing credits may be perceived alarming

The Turkish banking sector has increased its net profit by 33 percent in the second quarter of this year compared to the same period last year, official figures revealed.

The sector raised its net profit to 11 billion Turkish Liras, according to the quarterly Financial Markets Report prepared by the Banking Regulation and Supervision Agency, or BRSA. (more…)

Posted by meb at September 15th, 2009

The Banking Regulation and Supervision Agency (BDDK) has announced they expect the Turkish economy, which has already entered a recovery phase, to recuperate further in 2010, albeit gradually.

Evaluating the impacts of an ongoing global financial crisis on the Turkish economy in their “Financial Markets Report,” the banking watchdog said recent tax reductions in various sectors have contributed much to rejuvenation in the markets, adding that the current recovery trend is expected to continue in 2010.

The BDDK report estimates, however, that the recovery will not be instant but rather slower. Mentioning certain risks in the market, the report reads: “Although international markets signal the end of the crisis is not far away, a recovery will arrive only step by step, not directly. The fact that companies have difficulty accessing loan sources and the increasing debt of the private sector add to concerns that the crisis’ risks will prevail for some time.” (more…)

Posted by meb at September 15th, 2009

The worst bear run since the Great Depression is now in the midst of one of the most stunning reversals of all time.
After shedding historic amounts, the İstanbul Stock Exchange (İMKB) as well as markets around the world have performed near miracles, with US equities rallying more than 50 percent and the İMKB gaining more than 65 percent.

But is the rally sustainable? While analysts in the West appear to be divided, in Turkey there appears to be a general consensus that we remain in a cyclical bull market. Given the relatively lackluster economic signs in the developed world, investors are increasingly beginning to question this.

Autumn is traditionally a time where markets cool. Nonetheless, in Turkey and elsewhere, investors continue moving their investments into riskier stocks and out of such safe haven investments as Turkish government bonds.

“Turkey is under-leveraged,” said Murat Berk, a senior analyst at YapıKredi. “But we can’t say this in the Anglo-Saxon world. The Western world is coming to the end of the credit leverage sector. Turkey is at the beginning,” he said, suggesting that Turkey would likely continue to be affected by dynamics quite different from those in the West. (more…)

Posted by meb at September 15th, 2009

Turkey will probably reduce its key rate this week, making it only the third G-20 member to continue cutting borrowing costs, highlighting the depth of a recession the prime minister once forecast the country would avoid.

The Bank will lower its overnight borrowing rate by half a percentage point to 7.25 percent on Sept. 17, according to 23 of 24 economists surveyed by Bloomberg. The other analyst forecast a quarter-point reduction.

Another half-point reduction would bring Turkey’s rate cuts in the past 12 months to 9.5 percent, more than any other of 50 central banks tracked by Bloomberg except Moldova. Eleven months after Prime Minister Recep Tayyip Erdogan declared the global crisis would “barely touch” Turkey, the country has lost more output than 30 other economies in a study by DekaBank Deutsche Girozentrale.

“Except for the politicians in Ankara, whoever you talk to — in construction, real estate, manufacturing — there’s a consensus that this has been by far the worst ever,” said Tevfik Aksoy, an economist at Morgan Stanley in London.

Turkey’s gross domestic product, or GDP, shrank an annual 7 percent in the second quarter, after contracting a record 14.3 percent in the previous three months, the statistics office reported on Sept. 10. (more…)

Posted by meb at September 15th, 2009

No one in their right mind would invest in Turkey’s private health sector, says Abit Bakistanlı, chairman of the Hospitalium Medical Group. First the government provided major incentives to enable rapid growth in the sector, but now they are talking about cutbacks. Not only that but they do not have a five-year plan for the sector and ever-changing regulations generate major troubles, he says

The private health sector has been growing rapidly. Currently, it constitutes 30 percent of Turkey’s entire health sector, with 420 hospitals and 200,000 employees.

Once people with pension funds and social security were given the chance to receive treatment at private hospitals, lines at the doors of public hospitals shortened. But at the same time, the new system has quadrupled the government’s public health spending since 2002 to 34 billion Turkish Liras, according to Emin Zararsız, president of Turkey’s Social Security Institution, or SGK.

Investments in private hospitals are long-term, said Abit Bakistanlı, chairman of the Hospitalium Medical Group, which owns three hospitals and one medical center in Istanbul. Right now there are too many problems facing the sector therefore no one is investing, he said. “The only private hospitals under construction are those that had received permits earlier. No one in their right mind would invest in this sector right now. (more…)

Posted by meb at September 15th, 2009

Turkey’s domestic defense industry is expected to export weapons, equipment and services worth $1 billion in 2011, up more than $400 million from last year’s figure, the country’s procurement agency said in this year’s report on its strategic objectives.

The Turkish defense industry’s exports totaled $576 million last year. The balance comes from commercial sales by private and public defense companies.

The Undersecretariat for Defense Industries, or SSM, said in its “Strategic Document for Defense Industry, 2009-2016″ that it is implementing a plan to incentivize exports and aims to reach its $1 billion goal in 2011. (more…)

Posted by meb at September 14th, 2009

Pomegranate producers in Tarsus, a town in the Mediterranean city of Mersin, aim to make higher profits as Iran, the world’s top pomegranate supplier, is likely to see low yields this year.

Turkey ranks second in pomegranate production, and plantations cover nearly 45,000 dunams in Tarsus, which is on the sixth spot in terms of pomegranate cultivation, said Ali Ergezer, chairman of the Tarsus Chamber of Agriculture.

Due to high demand in domestic and foreign market, the pomegranate on a land of 500 dunams was sold while still on branch prior to harvest, said Ergezer. “But the producers that hear about the developments in Iran reject the merchants who offer prices between 80 kuruş and 1 Turkish Lira for a kilogram. The producers aim to keep the product and sell at or over 1.5 liras.”

The area of pomegranate plantations, which totaled 500 dunams 10 years ago, has reached 100,000 dunams with incentives, Ergezer said. “This year, 40 percent of the total planted area will be harvested in the middle of November. Due to climate conditions, the quality and yield will surpass expectations.” (more…)

Posted by meb at September 14th, 2009

Turkey’s sovereign debt rating may be raised by Moody’s Investors Service if the government shows determination to curb spending.

“The rating could be upgraded should the government put in place realistic plans to rein in the fiscal stimulus of the past few years,” Moody’s analyst Kristin Lindow said in an e-mailed report Friday.

Prime Minister Recep Tayyip Erdoğan met ministers last week to discuss tightening budget targets, after the country ran up a deficit of 23.2 billion Turkish Liras ($15.5 billion) in the first half compared with a surplus a year earlier. The International Monetary Fund has requested spending cuts as the two sides discuss a new loan agreement.

Istanbul Stock Exchange’s benchmark IMKB-100 index extended gains after the Moody’s statement, closing Friday at … Bond yields fell 4 basis points to 9.37 percent, according to an index of securities tracked by ABN Amro Holding.

Moody’s rates Turkey’s debt at Ba3, or three steps below investment grade. (more…)