Major Turkish Bank to Enter Bulgarian Market

The Turkiye Is Bankasi AS headquarters in Istanbul. Photo by anadolusigorta.com.tr

Turkiye Is Bankasi AS, the largest private bank in Turkey, intends to open a branch in Sofia through its subsidiary based in Germany, Isbank GmbH.

This has become clear from a report of the Bulgarian National Bank cited by the Dnevnik Daily, which says that after a notification by the German Financial Supervision Service, Isbank GmbH has started preparations for entering the Bulgarian market.

By using the EU passport of its German subsidiary, the Turkish bank will avoid the procedures requiring a license from the Bulgarian National Bank.

The "European Passport" allows credit institutions licensed in one EU country to open branches in another EU member state only by notifying the respective central bank.

In order to start banking in Bulgaria, Turkiye Is Bankasi still needs to get a confirmation from the BNB, and its branch office will have to meet the regular technical and communication requirements.

Is Bankasi is the largest private bank in Turkey with assets worth USD 86.4 B in September 2010, with a 13.7% year-on-year growth. Its profit for the first nine months of 2010 amounts to USD 1.646 B. It credit portfolio is USD 40.5 B, and its deposits amount to USD 55.7 B.

The Bank has 1135 branches in Turkey and 14 in Europe through its German subsidiary – 11 in Germany, and one in each France, Switzerland, and the Netherlands, a representative office in China. In October, it bought the Moscow-based Bank Sofia.

On December 31, 2009, 41.54% of it were owned by Isbank Members' Supplementary Pension Fund, 28.09% by Republican People's Party, or CHP, the major center-left party in Turkey, and 30.37% are traded freely on the stock exchange. The bank is listed on the stock exchanges in Istanbul and London.

In November, the CEO of the bank, Ersin Ozince, indicated that it is interested in opening offices in Sofia, as well as in Iraq, Azerbaijan, Egypt and Syria.

Two Turkish banks already function in Bulgaria – Ziraat Bank and D Bank – but the scope of their activities is small.

According to the Dnevnik, Isbank tried to enter the Bulgarian market several years ago but the BNB urged it to buy an existing institution rather than to start from scratch.

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