A research: The effect of foreign capital on Turkish banking sector

The aim of this dissertation is to investigate the effects on the Turkish banking sector, of the foreign acquisitions trend, which has been on the rise throughout the last decade. A panel data regression method has been utilized in order to analyze the effects on selected financial ratios of the internationalization of commercial banks that operate within the Turkish banking sector. As a result of the tests, it has been observed that an increase in foreign capital decreases profitability in the Turkish banking sector, while it has no statistically significant impact on interest margins, non-lending activities or short-term risk. On the other hand, interest margins of state banks are relatively higher and, being traded on the stock exchange tends to reduce short-term risks. Keywords : Banking Internationalization, Foreign Entry, Financial Performance