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Southeast Europe
May 31, 2019 www.intellinews.com I Page 13
Turkey’s top 500 saw 2018 profits wiped out by crisis-triggered financing costs says industry chamber
bne IntelliNews
Turkey's top 500 industrial companies saw almost all their profits erased by financing costs in 2018 after the eruption of the country’s currency crisis, the Istanbul Chamber of Industry (ISO) said on May 28.
Amid and following the economic turmoil caused by the collapse in value of the Turkish lira (TRY), the debt ratio of the ISO's 500 big industrial firms climbed to 67% in 2018, while their own capital ratio fell to 33%, the report said. The resource structure was thus the "most negative" on record, it added.
A recession has fallen over Turkish commerce and the big corporates are hurting. Pictured is Istanbul's Istiklal Avenue.
The ISO also observed that for Turkish companies access to financing has become a "chronic prob- lem" over the last few years. No improvement was observed last year, it said.
Turkey plunged into a deep recession after the lira crisis. At its nadir, the TRY lost nearly half its value against the USD. When 2018 closed, the weakening stood at 28%, but the currency has lost around another 14% this year to date.
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Southeast Europe’s banking sector gets new investor geography
Clare Nuttall in Glasgow
The ownership profile of Southeast Europe’s banks has changed significantly since the international economic and financial crisis of 10 years ago.
Banks from the crisis-hit Greek banking sector, which previously had a strong presence in the Bal- kans, are withdrawing from international markets as part of the sector bailout, while other banks that had expanded pre-crisis were also left reevaluating their presence especially in small, non-core markets.
Others, however, are looking to expand into Europe’s southeast frontier, and none more aggressively than Hungary’s OTP.
The bank’s chairman-CEO Sandor Csanyi outlined OTP’s future plans at its AGM in April, saying the ongoing acquisition spree will continue as it aims to acquire three more banks in the region, after which it will take a break to digest its new assets.
Hungary’s largest lender has already taken over subsidiaries of French lender Societe General in Bulgaria, Albania, Serbia, Moldova and Montene- gro, bringing the number of foreign units to 11. By the end of 2019, it will be present in 12 coun- tries, if it manages to close a deal in Slovenia.
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