Turkey banking industry profit falls to lowest since 2016
Profit in Turkey’s banking industry fell to the lowest level since 2016 in the first nine months of the year, Dünya newspaper reported.
Net income dropped by an annual 12.5 percent to 36.2 billion liras ($6.3 billion), Dünya said on Thursday, citing data from the banking watchdog (BDDK). Profit was 37.2 billion liras in 2017 and 41.3 billion liras in 2018, it said.
Profit in the third quarter alone was 11.3 billion liras, the lowest in 11 quarters, the newspaper reported. The figures do not take account of the erosive effects of inflation and the impact of currency movements.
Turkish banks’ profits are being hurt by the higher costs of borrowing abroad after a currency crisis last year. Margins are also narrowing due to government pressure to reduce interest rates on loans and an increase in bad debt.
Interest income in the first nine months increased by 25 percent from a year ago to 320.4 billion liras. Interest expenses climbed by an annual 39 percent to 206.5 billion liras.
Profit in September was 3.31 billion liras, a decrease of 1.2 percent from August. Profit for the month declined by 28 percent on an annual basis, Dünya said.