Turkish banks record 41% profit spike in first seven months

The total assets of the banking sector in Turkey rose by a whopping 39.2% from the end of 2022, reaching 19.965 trillion lira, showing a substantial growth of the sector during the seven months leading up to July 2023, a report by the The Turkish Banking Regulation and Supervision Agency (BDDK) revealed on Tuesday.

Furthermore, as of the end of July, the banking sector recorded a significant net profit growth of 41%, totaling 293.417 billion lira. The sector also achieved a capital adequacy standard ratio of 18.70%.

The BDDK recently published the report titled "Main Indicators of the Unconsolidated Turkish Banking Sector for July 2023." The report elaborates that the total assets of the banking sector reached 19.965 trillion and 570 billion lira in July. Compared to the end of 2022, this indicates an impressive increase of 5.618 trillion and 180 billion lira, which represents a 39.2% hike.

The largest asset component of the banking sector, loans, witnessed a notable growth of 36.2% compared to the end of 2022, standing at 10.322 trillion and 795 billion lira. Simultaneously, the total value of securities surged by 42.3% to reach 3.373 trillion and 669 billion lira. The non-performing loan ratio for this period also stood at a relatively low 1.60%.

Additionally, deposits, which represent the most significant source of funds for banks, saw a rise of 40.6% since the end of 2022, amounting to 12.455 trillion and 894 billion lira.

Meanwhile, the total equity for the same period grew by 28%, reaching 1.799 trillion and 4 billion lira.

With the Turkish banking sector demonstrating such strong financial metrics by July 2023, the industry’s future looks promising. This substantial net profit of 293.417 billion lira and the capital adequacy standard ratio of 18.70% affirm the sector's robustness and resilience in a dynamic economic environment.