Page 40 - Buy Russia - bne IntelliNews monthly magazine April 2017

40 I Special report bne April 2017
Best Trade Finance Bank in Turkey
Yapi Kredi
Established in 1944 as Turkey’s first retail-focused private bank with a nationwide presence, Yapı Kredi is the fourth larg- est private bank in Turkey with more than 19,000 employees and 12.9mn active customers. It is also one of the most active banks in trade finance, providing its customers with a wide range of trade-related products through over 2,000 corre- spondents and its strong financial institutions network.
Yapı Kredi manages a foreign trade flow of more than $60bn yearly. Circa $7bn of this flow is letter of credit- based. With one of the most experienced trade finance teams in Turkey with an average experience of 15 years in the field, Yapi Kredi provided/intermediated approximately $5bn funding to exporters in 2016.
“Yapı Kredi was one of the most active banks throughout the year intermediating Turkish Eximbank and Central Bank of Turkey funded loans with the aim of supporting exporters during this volatile period,” says Feza Tan, assistant general manager. “This support resulted in an increase of the wallet share of Yapı Kredi in the foreign trade flows of its existing clients; acquisition of new clients willing to use Yapı Kredi expertise gained momentum in 2016 as well.”
Feza Tan, assistant general manager
2016 was a year that was beyond standard practice in the Turkish economy and business world, notes Tan. Not only the effects of global developments but also local economic developments made 2016 a more fragile year for compa- nies in terms of managing their foreign trade activities.
High fluctuation in FX rates during the year and flat GDP growth were the main challenges companies faced in 2016. “This situation has shown the need of having an experi- enced financial partner and using banking products more effectively, therefore Yapı Kredi’s market share in Turkey’s total foreign trade rose almost 2pp in the last two years.”
Yapı Kredi provides its customers global transac-
tion banking services via trade finance, structured export & trade finance and cash management prod- ucts through diverse channels including e-banking and digital solutions and maintains a strong position in the sector. While offering multinational solutions, to local customers in this area, Yapı Kredi also leverages Uni- Credit’s product scheme and utilises its experience and funding sources in its countries of operation.
nies. This situation has shown the need of having an experienced financial partner and using banking products more effectively,” says Feza Tan, assis- tant general manager, Yapi Kredi.
And where there is a crisis, there is also an opportunity. “Yapı Kredi was one of the most active banks throughout the year intermediating Turkish Eximbank- and Central Bank of Turkey-funded loans with the aim of supporting exporters during this volatile period,” adds Tan. “This support resulted in an increase in the wallet share of Yapı Kredi in the foreign trade flows of its existing clients; acquisition of new clients willing to use Yapı Kredi expertise gained momentum in 2016 as well. Yapı Kredi’s market share in Turkey’s total foreign trade has risen almost 2% in the last 2 years.”
Grim outlook without helping hands
Overall banks remain positive about the role of multilateral develop- ment banks (MDB) and export credit agencies (ECA) in addressing short-
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falls, with 75% agreeing that both help narrow trade finance gaps.
These include among others the Asian Development Bank, the Inter-American Development Bank, the International Finance Corporation, the International Islamic Trade Finance Corporation, and the EBRD. The latter’s trade facilita- tion programme has been acknowl- edged as one of its most successful initiatives, facilitating 19,000 transac- tions worth €13.3bn since 1999.
But the success forged together with partner banks that the MDBs and
ECAs support depends on there being
a functioning environment to work in. Swathes of new regulatory requirements have driven many banks to abandon their trade finance work altogether,
says TFP head Putz. “There is a total disconnect between the regulators who make the rules and the people who do the trade finance business. They don’t really care about what the banks think
or need ... Small banks in Eastern Europe may not even be able to find
a single Western correspondent bank that is still able and willing to sup- port those smaller banks in high-risk countries and do smaller transactions.”
The problem began in the last five or six years and banks and development banks have constantly pushed this issue with the ICC and World Trade Organisation (WTO), Putz says. “But since then nothing has changed.”
If these issues go unresolved for much longer, it could have egregious effects for world economies and global rela- tions as a whole, given the harmon- ising role of cross-border trade.
And this could ultimately just leave the big banks remaining active in trade finance, cherry picking the biggest transactions while a far greater vol- ume of healthy business comprised of smaller deals never comes to fruition.