Turkish state’s takeover of Bank Asya ‘not political,’ economy czar says

Turkish state’s takeover of Bank Asya ‘not political,’ economy czar says

Turkish state’s takeover of Bank Asya ‘not political,’ economy czar says

Turkey's President Recep Tayyip Erdoğan, centre, accompanied by Hüseyin Aydın, left, General Manager of Ziraat Katılım Bankası, a new public investment bank and Deputy PM Ali Babacan, right, pray during the opening ceremony for the bank, in Istanbul, Turkey, Friday, May 29, 2015. (AP Photo/Emrah Gurel)

Deputy Prime Minister Ali Babacan said on May 30 that Turkish authorities' decision to take over Bank Asya was not “political.”

“If it was political, why would [the government] wait for one and a half years? All these actions could be taken long time ago if it was a political decision,” Babacan said in an interview to private broadcaster Kanal 7.

Babacan added that banking authorities informed him, as well as President Recep Tayyip Erdoğan and Prime Minister Ahmet Davutoğlu, before taking over Bank Asya, “as it is done with any similar critical move before it is publicized.”

Turkish authorities said on May 29 they had decided to take over Bank Asya, the Islamic lender caught up in a feud between Erdoğan and U.S.-based Muslim cleric Fethullah Gülen. 

The move was announced by the banking watchdog BDDK, just over a week ahead of a parliamentary election. It followed an earlier decision by the BDDK to take management control of the bank, citing its failure to meet legal criteria. 

The action was launched after a run on deposits at Bank Asya last year when it became embroiled in the power struggle between Erdoğan and Gülen, whose followers had set up the bank. 

The BDDK statement said it acted as "problems experienced in the bank's activities with its financial structure, its partnership and management make-up presented a danger ... in terms of confidence and stability in the financial system." 

It handed over control of the bank to Turkey's Savings Deposit Insurance Fund (TMSF), which is responsible for dealing with troubled banks. 

Turkey's move to seize management control of the bank in February had prompted accusations of political meddling that could hurt the country's reputation with international investors.