26 million do not have bank accounts in Turkey

26 million do not have bank accounts in Turkey

ISTANBUL
26 million do not have bank accounts in Turkey

Garanti Bank’s Chief Executive Officer Özen says that Turkey has a rich pool of potential bank customers as 26 million people do not use banking services.

The number of potential bank customers in Turkey will exceed those in England, France, Spain, Italy and Germany combined by 2020, according to Ergün Özen, chief executive of Garanti Bank.

Some 26 million adults in Turkey do not use banking services, he said, speaking at a meeting in Istanbul where he revealed the company’s first quarter financial results. “The number of small and medium size enterprises that use banking services will also increase. The banking industry will grow more quickly in provinces other than Istanbul, Ankara and İzmir. The loan penetration level will come close to those in developed countries.”

However, Turkey should increase the ratio of domestic savings to national output, he said, noting that the ratio now stands at only 13 percent, whereas it is at 30 percent in India and more than 50 percent in China, two of the world’s fastest-growing economies.

Garanti Bank posted a net profit of 962.2 million Turkish Liras for the first quarter of 2012, Özen said. The bank’s assets total 165.7 million liras, and its overall loans reached 113.1 million liras. Garanti’s equity-to-capital ratio was 20.9 percent and, its return on assets was 2.4 percent in the first three months of the year.

The rate of non-performing loans in the Turkish banking industry overall is 2.7 percent, while the rate is only 1.9 for Garanti, Özen said. The rate of non-performing loans is increasing, he said, adding that, “We have begun to observe this clearly in credit cards and consumer loans.”

Turkey