Iran dealings put Turkey's Halkbank in spotlight

Iran dealings put Turkey's Halkbank in spotlight
Turkish lender Halkbank, little known outside Turkey, has gained a reputation in the oil market over the past 18 months for handling transactions that other banks fear to touch - trade deals with Iran, Today`s Zaman reported.

Now a new law signed by President Barack Obama last Saturday, which imposes US sanctions on financial institutions dealing with Iran's central bank, has put the bank squarely in the spotlight.

Halkbank's stance toward Iran largely has reflected the attitude of the Turkish government, which owns 75 percent of the bank, towards international sanctions against Tehran over its nuclear program.

Heavily dependent on imports of oil and gas from its neighbor, Muslim NATO member Turkey opposed the imposition of UN sanctions on the Islamic Republic in 2010 but says it is abiding by those measures.

Officials have repeatedly said, however, that there is no obligation for Turkey to enforce tougher unilateral sanctions subsequently announced by the United States and European Union.

US Treasury officials have visited Turkey several times since to advise banks that doing business with proscribed Iranian entities runs the risk of being frozen out of the US financial system.

That appeared to hold little threat for Halkbank given its profile as a state-controlled bank with few direct links to the United States. But the new US law could turn up the pressure.

The sanctions, according to a senior US official, would target private and government-controlled banks -- including central banks -- and would take hold after a warning period of two to six months, depending on the transaction.

Obama could grant waivers to institutions in countries that significantly reduce dealings with Iran.

On Wednesday an Energy Ministry official confirmed Turkey would seek such a waiver for its sole oil refiner, Tüpraş, a major customer for Iranian oil.

Halkbank handles payments to Iran by Tüpraş, which is owned by the Turkey's largest conglomerate Koç Holding, according to industry sources with knowledge of the transactions.

Indian refiners, unable to pay Iran for imported oil through their own banking system for fear of US retribution, turned to Halkbank in mid-2011 to make payments.

In December, Halkbank refused to open an account for an additional Indian refiner, BPCL, for that purpose. No reason was given, though there was speculation that Turkey wanted to avoid further antagonising Washington.

Halkbank was contacted over the status of the bank's dealings with Iran, but senior officials were unavailable for immediate comment.

Halkbank has limited operations overseas.

Its website lists a branch in Bahrain and four in Turkish Cyprus, which cater for Turkish Cypriots living in the state recognised only by Turkey.

It also has a representative office in Tehran that it inherited in 2004 when it took over Pamukbank, once a jewel of Turkish tycoon Mehmet Emin Karamehmet's business empire.

Customers cannot open accounts there, but the Tehran office does help handle interbank deals and issues with Iranian banks.

According to a banking source in Tehran, the Halkbank office used to also help others including European banks make payments to Iran, but those activities ended after the EU and US sanctions were imposed.

"Business has become much tougher these days," the source said.

Now, according to that source, the Tehran office deals only with trade and payments between Turkey and Iran, and checks are made to ensure that it does not violate UN sanctions.

Most of Halkbank's business involves lending to domestic companies as Turkey's economy boomed over the past decade.

"The bank is working with chamber unions and local cooperatives. It's a different model compared to other Turkish banks, a much more defensive structure," according to an İstanbul-based banking analyst, who requested anonymity while speaking about a state-controlled bank.

"During the global crisis in 2008-2009, non-performing loans of Halkbank were much lower compared to peers."

Halkbank has grown to become the country's sixth-largest bank based on unconsolidated assets and held a domestic market share of nearly 8 percent by end-September, according to Fitch Ratings.

Subscribe to Trend in Google News! Subscribe
Renovation of thousands of old houses going on in Iran
Renovation of thousands of old houses going on in Iran
German companies sign contracts with Azerbaijan in railway construction
German companies sign contracts with Azerbaijan in railway construction
Volume of investments in construction of bp's power plant in liberated Azerbaijani lands revealed
Volume of investments in construction of bp's power plant in liberated Azerbaijani lands revealed
Loading Bars
Georgia’s textile imports from Turkey increase
Azerbaijan suffered from equal approach to aggressor and aggression victim - MFA
Iran records increase in transit of goods via trucks through its territory
Azerbaijan working on several youth development projects - Minister of Youth and Sports
Possible opening of cruise line between Azerbaijan, Russia has high potential - Astrakhan governor (Exclusive)
Azerbaijan sees increase in concluded labor contracts over past four years - minister
Azerbaijan’s Central Bank talks increase in non-cash payments (PHOTO)
Azerbaijan to be fully covered by internet by late 2024 - deputy minister
Georgia releases COVID-19 data for December 8
Developing contactless payments to help further digitalize Azerbaijan's economy - VISA
Azerbaijan talks progress of tunnel road building between Goygol, liberated Kalbajar districts
Azerbaijani oil prices increase
Baku holds Azerbaijan Career Development Forum (PHOTO)
Business centers of Azerbaijan, Russia’s Astrakhan sign memorandum of co-op (PHOTO)
Baku port transports goods in transit mainly to Central Asia, Europe – head of main cargo terminal
Kazakhstan eyes increasing requirements for commodity exchanges
Georgia launches energy reform program, backed by KfW, EU
Uzbekistan shares domestic COVID-19 data for December 7
Iranian currency rates for December 8
Oil prices ease as investors wait for assessment of Omicron's impact
EIA revises down forecasts for Azerbaijan’s 2022 petroleum production
Azerbaijan to commission new enterprises for production of sulfuric acid and glass containers
MFA issues statement on 30th anniversary of Azerbaijan's membership in OIC
Iran's Energy Exchange announces products to be on sale on Dec. 8
OSCE Minsk Group Co-Chair countries release statement
Gunmen torch bus, kill 30 passengers in Nigeria's Sokoto state
Azerbaijan’s Central Bank talks dev’t strategy for securities market until 2023
Pfizer Shot Provides Partial Omicron Shield in Early Study
Australia joins diplomatic boycott of Beijing Winter Games
704 new COVID-19 cases reported in Kazakhstan
France reports record daily COVID-19 count
U.S. Senate backs $650 million missile sale to Saudi Arabia
Mandatory vaccination should be a last resort, says WHO Europe chief
Bolsonaro dismisses vaccination requirement for entry into Brazil
Israel announces completion of high-tech barrier around Gaza
Northern Ireland reports first Omicron cases
Police officer killed in NW Pakistan's firing
Sweden to reintroduce many COVID-19 measures as cases rise
Armenia has no choice but to open Zangazur corridor - experts
Turkey, Qatar strengthen bilateral ties with 15 new deals
Georgian parliamentary delegation visits Washington
Chinese company plans to build a technopark and solar power plant in Uzbekistan
WHO donates 260k packs of intravenous solutions to Iran
Cost of cargo transported via trains up in Azerbaijan
International Court of Justice grants Azerbaijan's request for temporary measures against Armenia
Western media shows neutral approach to Azerbaijan’s Zangazur corridor - Head of Trend News Agency’s Foreign Projects Directorate
Azerbaijan donates 100,000 doses of Sinovac vaccine against COVID-19 to Burkina Faso (PHOTO)
Information spread in Armenian media about killing of illegal militant on territory of Azerbaijan is baseless – MoD
Azerbaijani MFA comments on statement of Armenian foreign ministry
International Court of Justice urges Armenia to take urgent measures against groups and individuals making violent calls on ethnic grounds
International Court of Justice refused to secure Armenia's claim for immediate return of so-called POWs
Azerbaijan completes over half of construction of Barda-Aghdam highway
Azerbaijan building new high-speed road in Shusha city
Azerbaijan-Iran plan to build new bridge to increase traffic
Iran Securities and Exchange Organization focusing on strengthening Capital Market Stabilization Fund
Iran looks to expand agricultural ties with Romania
EIB, EBRD touch on Georgia’s economic growth
Price indexes of industrial, trade sectors at Uzbek stock exchange fall
Georgia shortens terms of COVID-19 booster vaccination
Azerbaijan shares data on 10M2021 oil exports to Vietnam
Uzbekistan shares stats on export of textile products for 10M2021
Kazakhstan's KMG talks project of new gas processing plant in Mangistau
Iran's Bahar Azadi gold coin price increases
Azerbaijan sees decrease in import of vehicles, spare parts over 10M2021
Volume of loaded/unloaded cargo in Iran’s Qeshm port up
Value of Azerbaijan's export to Turkmenistan up for 10M2021
Azerbaijan’s energy ministry opens tender to buy technical support services
Azerbaijan-Iran to take steps to increase trade turnover – Iranian ambassador
Shootout occurs on border between Azerbaijan and Iran - offender neutralized
Baku Int'l Sea Trade Port reveals details of dev’t strategy until 2035
First harvest gathered in mushroom greenhouse in Turkmenistan’s Mary region
Azerbaijan-Iran implementing agreements on joint cooperation – ambassador
Germany's next finance minister stresses price stability
SOFAZ shares estimates of budget revenues for 2022
Iran opens office for cargo barter with Pakistan
Number of legal entities restoring activity in Azerbaijan slightly increases in 11M2021
President Ilham Aliyev receives President for Exploration and Production of TotalEnergies (VIDEO)
Indian embassy in Baku holds webinar on electronic and computer hardware/software products (PHOTO)
Sport in Azerbaijan - integral part of state policy, deputy minister says
Bank of Israel bought $4 bln of FX in Nov, hits $34 bln in 2021
India's Rajnath Singh attends maiden 2+2 Dialogue with Russia
Less urgent need to rebuild stocks to weigh on coal demand
Omicron poses a major risk to global oil demand
Azerbaijan shares data on number of vaccinated citizens
Azerbaijan confirms 1,530 more COVID-19 cases, 1,864 recoveries
Azerbaijan, Russia’s Astrakhan sign action program to develop co-op (PHOTO)
Georgia shares data on cigarettes turnover in 10M2021
President Ilham Aliyev signs order appointing new chairman of State Insurance Commerce Company
Georgia’s imports of fuel and lubricants from Kazakhstan plummet
EU health bodies recommend mix-and-match of COVID-19 vaccines
Georgian apple exports on rise
Number of taxpayers increases in Azerbaijan over 11M2021
Kazakhstan increases volume of production of crude oil and oil products
Kazakhstan shares data on coal production
Turkmenistan becomes top oil exporter to Georgia
Armenia should fulfill requirements of documents signed after Second Karabakh War – Turkish official
Google Pay begins operating in Israel
Volume of electricity production in Uzbekistan for 10M2021 unveiled
Azerbaijan records growth in cost of air cargo transport for 10M2021
Iran reveals COVID-19 data for December 7
All news