Banking sector sees $5B net profit in January-July

ISTANBUL

The Turkish banking sector’s net profit totaled some 28.2 billion Turkish Liras ($4.97 billion) in the first seven months of 2019, the country’s banking watchdog, BDDK, reported yesterday. In the same period of last year, the combined net income of local banks stood at 33.6 billion liras.

According to data from BDDK, total assets of the sector rose by 7.8 percent from the end of 2018 to reach 4.17 trillion liras. Loans - the biggest subcategory of assets - extended by local lenders grew by 4 percent compared to end-2018 to hit 2.5 trillion.

The non-performing loans to total loans ratio stood at 4.42 percent as of July, while the industry’s capital adequacy ratio was 18.19 percent, data showed.

The banks’ net interest income increased by 8 percent on an annual basis to hit 85.6 billion liras with interest revenues from loans jumping 29 percent year-on-year to 191 billion liras. Local lenders’ total interest expenses were at 164 billion liras, a 57 percent increase from a year earlier.

Interest payments to deposits grew by 58 percent in the first seven months of the year to stand at 111 billion liras.

On the liabilities side, deposits held at lenders in Turkey were 2.26 trillion liras, an 11 percent increase from the end of 2018. Last year, the Turkish banking sector’s net profit totaled 53.5 billion, up 10 percent annually. According to a June report from the BDDK, there were a total of 53 banks - 34 deposit, 13 development and six participation banks - in the country. Local banks employed 206,032 personnel and had 11,495 branches.