Turkish development bank’s assets, loans increase in first quarter

Turkish development bank’s assets, loans increase in first quarter

Turkish development bank’s assets, loans increase in first quarter

Turkey’s prominent development bank has increased its assets and loan rate in the first quarter, according to the lender’s financial disclosure.

The total assets of the Development and Investment Bank of Turkey (TKYB) increased 25.7 percent to 21 billion Turkish Liras ($3.01 billion), while the ratio of loans, which make 78.3 percent of the assets, increased 11.8 percent to 16 billion liras ($2.3 billion) in Jan-March period.

At the end of the first quarter, TKYB’s gross non-performing loans rate decreased 0.14 percent to 0.68 percent. The bank’s net profits was at 90 million liras ($1.3 million) in the first quarter, whereas its capital adequacy ratio was 20.4 percent.

“Supporting the production potential of the economy, the monetary and fiscal measures will contribute to prevention of the affects of the coronavirus pandemic on business activity and employment,” said İbrahim Öztop, CEO of TKYB, hailing the steps taken by the government and the Central Bank to cushion the economic fallout of the coronavirus pandemic.

Meanwhile, The European Bank for Reconstruction and Development (EBRD) has provided a 100-million-euro ($108 million) loan to a Turkish lender to support trade and small businesses, the bank announced on May 14.

Thanks to the financing package, QNB Finansbank will ramp up trade activities and lending to small businesses amid the coronavirus pandemic, said a statement from the EBRD.

Half of the funding will back trade finance activities such as guarantees to international confirming banks, taking the political and commercial payment risk of international trade transactions, while the rest will be on-lent to local companies suffering from the pandemic's fallout.

“Our financing for QNB Finansbank has three important goals: to provide finance needed to keep trade flowing, to bridge the liquidity gap for companies under stress, and to strengthen the resilience of the Turkish banking sector,” said Arvid Tuerkner, EBRD managing director for Turkey.

“Financing provided by the EBRD will support SMEs that experience liquidity problems and help them maintain cash flows while minimizing the effects of the pandemic," Temel Guzeloglu, the Turkish bank’s CEO, said.

In parallel, QNB Finansbank has mobilized $255 million from nine international lenders, and has agreed to a 25-million-euro ($27 million) loan from Proparco, a French development financial institution, to support agriculture.

As a major investor in Turkey, the EBRD has invested almost 12 billion euros ($13 billion) in various sectors since 2009.

The EBRD's Turkey portfolio with a volume of 6.7 billion euros ($7.5 billion) is the largest among the 38 economies where the bank invests.