The privatization of public banks and an example of Turkey

The major economies had supported the role of government for onlynational security, defence and justice system till the global recession led by 1929Black Monday of States. Due to the critical results of this crisis and thestructural changes in European economic systems followed by the World WarII, the importance of government enterprises? role in industrial and commercialenterprises has been dramatically increased. These vital changes in the majoreconomies in Europe have also affected Turkish Banking System and majorgovernment banks were founded during the first years of the proclamation ofRepublic of Turkey.In 1990?s, the major economies have gradually commenced to discuss theimportance of government?s active role in banking sector. In the majoreconomies, it has been experienced that the government?s role is not efficient tosupport economical growth. Furthermore, the government?s involvement hasnot only negatively affected economic growth but it also created an economicalsystem without any competition and lack of productivity. Government bankshave been underperformed due to the inefficient recruiting policies,inexperienced executive management, lack of operational capabilities andincapable risk management systems.In 2000, the restructuring process of the state-owned banks started in thesystem. Hence, all assets and liabilities of T.Emlak Bankası have been mergedinto to Ziraat Bank, the largest state-owned bank; Ziraat Bank and Halk Bankhave been organizationally and operationally restructured; Vakiflar Bank?swent for IPO for its shares of 25,18%. The block sale of T. Halk Bank A.S. isrecently in the agenda of the Turkish government.Key words: 1) Privatization, 2) Public Banks, 3) Performance Analysis,4)Privatization of Public Banks, 5) Restructuring of Public Banks