Turkish state-owned lender Halkbank has been ranked among the global banks that lost much of its brand value in 2013, according to a list issued by the international publication The Banker.The brand value of Halkbank, whose chief executive was arrested in connection with the graft investigation, was drained $303 million throughout last year, The Bankers Top 500 Banking Brands list released Feb. 3 revealed.
The bank that became the 15th biggest absolute brand value losing bank in globe dropped 41 ranks to 189th place in the overall list of 500 Top Banking Brands.
The state lender has been handling oil payments for imported oil from Iran to Turkey despite Western sanctions imposed on former.
Halkbank has repeatedly said its dealings with Iran are entirely lawful, but its Iranian business ties had drawn Western criticism amid U.S.-led efforts to curb Tehrans disputed nuclear program. The transfer of gold and money to Iran via Halkbank is under scrutiny as part of the corruption investigation launched on Dec. 17, charging businessman Reza Zarrab with forming a ring that bribed officials, including Halkbank chief executive Sleyman Aslan, to help disguise illegal gold sales, former Economy Minister Zafer a?layan and former Interior Minister Muammer Gler.
The banks shares plummeted over 12 percent a day after investigation launched. In overall, the banks market value dropped by more than 15 percent betweeen Dec. 17 and Jan. 14, falling from 19.74 billion Turkish liras of Dec. 16.
Two Turkish lenders among top 100
Despite having a tough year, majorly marked by currency uncertainties, Turkish banks recorded a solid performance in 2013 by keeping their 18th position in the world with slightly raising their total brand value to 9.9 billion from 9.6 billion of previous year, The Banker report also showed.
Turkish lenders Akbank and ??bank have been also re-named among the 100 most valuable banking brands in the world as of 2012. Both lenders climbed the ranks as well, as Akbank jumped to 86 from 96 from the previous year, ??bank made it to 89 from 98.
Particularly the second half of the year was hard for the private sector, which has mounted dollar debt, as the Turkish Lira weakened to record lows due to a twin strike of domestic political tensions and the United States Federal Reserves decision to taper its bond-buying program.
Last week, Turkeys Central Bank dramatically hiked all its key interest rates at an emergency midnight policy meeting as it fought to defend the countrys crumbling currency, adding pressure of banks.
The ratings agency Moodys said Turkeys sharp interest rate hike will squeeze the profitability of its banking sector through higher funding costs and worsen the quality of bank assets, CBRTs (the Central Bank) measures will constrain banks revenue generation and profitability, Moodys said in a sector comment released Feb. 3.
By The Journal of Turkish Weekly
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