Monday, March 21, 2011
ISTANBUL - Hürriyet Daily News
French banking giant BNP Paribas may use its Turkish unit Türkiye Ekonomi Bankası, or TEB, to expand to the rapidly growing Middle East and Balkans regions, according to its top executive in Turkey.
BNP Paribas Turkey head Jean-Paul Sabet was speaking on the sidelines of a press conference that marked the completion of the acquisition of Fortis Bank in Turkey by TEB.
“What is obvious is that Turkey has a natural influence in former Ottoman countries,” Sabet told the Hürriyet Daily News & Economic Review. “Turkish banks will be well-placed in such regions in the long run. We are considering having branches in such regions.”
TEB already has a branch in Kosovo, which has the third-best market share in the tiny country.
BNP Paribas, Europe’s biggest bank by assets, had a 42.125 percent share in TEB, which is 15.63 percent publicly traded. After the merger, BNP Paribas and Turkish Çolakoğlu Group will have equal shares in the non-publicly traded portion of the lender.
TEB announced last June it would acquire the Turkey operations of Fortis, as part of the latter’s asset sale policy.
“Turkey ranks among the top-five strategically important markets for us, following France, Italy, Belgium and Luxembourg,” Sabet said, adding that Turkish banking has proved its resilience. The top manager noted that banking penetration in the country is still low, presenting growth potential for new investments. Sabet told the Daily News he sees Turkey as a hub in the region “to penetrate countries in the Mediterranean, the Balkans, and the Middle East.”
Considerable asset growth
After the acquisition, TEB reached an asset size of $30 billion, 3 million individual customers and nearly 500,000 corporate customers. It now has 600 branches and nearly 1,000 ATMs across the country.
“TEB aims to increase its market from 3 percent to 5 percent in the next two years,” Sabet said, adding that the acquisition of Fortis went smoothly, as both banks were almost the same size and there was no cash transfer. “There was just an exchange of shares,” he said. On Nov. 25, TEB offered 1.0518 shares for each Fortis share.
Talking at the press meeting, TEB board chairman Yavuz Canevi said the cost of the merger would reach approximately 300 million Turkish Liras by 2013.
“TEB has been professional with corporate customers while Fortis has been always active in loans, mortgage credits, and individual customer products,” said Varol Civil, TEB’s general manager. He said that the unity will generate a great synergy and that the bank will have the chance to introduce more products to its customers, enjoying BNP Paribas’ strong international network. “We may issue lira-denominated bonds this year,” said Civil.
Addressing journalists, Civil said TEB has a 3.8 percent domestic market share in loans and a 2.8 percent share in deposits. “We aim to reach 5 percent in both areas in the next few years,” he said.
Responding to a question on whether BNP would acquire more of TEB in the future, Sabet said it took nearly one year to find the equilibrium that serves the interests of both parties. “There is no such plan on the table at the moment.”