Economic activities contribute to increase of banking sectors in
Turkey since expectations have developed rapidly and there is a
stability which has been sustained in the financial markets.
Therefore, this situation reflects to ascend the effectiveness of
supervision in the banking system.
The banking sector shapes a great part of the Turkish financial
system in its dynamic economy because most of the transactions and
activities of money and capital markets are complemented by banks.
In particular, both private and most state banks have close
connections to large industrial groups and holdings.
Establishment of Bank in Turkey
So as to ensure financial stability, there are lots of
structural reforms which have been introduced in the banking
system. Thus, any bank to be established in Turkey shall accomplish
certain requirements in accordance with the Banking Law No 5411
such as constitution requirement as joint stock market and a
paid-up capital amount of minimum thirty million Turkish liras.
Also, this requirements involve the importance of financial
strength and respect and the founders shall have the required
competence for the business. Hence, the founders should meet these
requirements and these regulations make room for incentive of
All banks in Turkey are subjected to the Banks Act and to the
provisions of other laws regarding to banks. In regard to this, all
new law or regulations are provided by the Banking Regulation and
Supervision Agency and aim to safeguard the rights and benefits of
depositors. Moreover, the Bank Association of Turkey is the
representative body of banking sector which constituted for
protecting and promoting the professional interests of its members.
This is the official authority for licenses for bank establishment
and operations in Turkey. This law raises responsibilities of
ownership, personnel of banks and brings in new liabilities to
them. Also, banking legislation enables entrepreneurs to set up
banks and makes contribution to recovery of market.
Banking Sector for foreign bankers
Any bank established abroad which will actuate in Turkey by
opening branch within the framework of the principle and procedures
set by the Board should to meet some followings. It is vital that
there are no distinctions between foreigners and Turkish companies
in order to establish bank since the legislature procedures are the
same. In conformity with the Banking Law No 5411, its primary
activities must not have been prohibited in the country in which
they are headquartered and also the supervisory authority in the
country, where in the headquarters of the bank is located should
not have the views regarding its operation in Turkey. This
implementation assists to establish foreign bank in Turkey because
there is no strict in terms of legal procedure in licenses and
In respect to this, operating license has a powerful influence
on banking sector in terms of procedure. According to article 10 of
the Law No. 5411, the banks are permitted to be established in
Turkey or permitted to open up branches in Turkey shall be obliged
to receive license for operation from the board. The decision
regarding license shall be made within three months, the
determination of this license issuance term may be regarded as
positive for investors in banking sector. Especially, banking laws
provide an advantage for entrepreneurs in terms of time and it is
not hard to establish bank in Turkey under these circumstances.
What are advantages of establishment of bank in Turkey?
One of the advantages of establishing a bank is that it is ease
to establish bank or open a branch in terms of legal procedures.
Although many countries encounters global financial crisis and
banking sectors impacts financial crisis, Turkish economy continues
to develop. Moreover, financial structure of the banking sector
reinforces with the improvement of profitability performance of
banks and the enlargement of financial system facilitates to
develop funds and loans of the banking sector. To illustrate, many
foreign bankers prefer to establish a bank in Turkey or bring their
own branch to Turkey. Turkish banking sector has been attracting
foreign investment from lenders in Europe, the Middle East and the
Far East. As a result of this, Turkey has large scale
infrastructure projects and foreign investors form a basis for
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guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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