Evaluating the Performance of Public, Private and Foreign Banks Operating in Turkey

This study attempts to compare the financial performance of public, private and foreign banks operating in Turkey from 1997 to 2010, as well as conducts a pre and post global financial crisis performance analysis for public, private and foreign banks. The following profitability proxy indicators were used; Return on Assets (ROA), Return on Equity (ROE), Profit per Employee (PPE), Profit per Branch (PPB), Net interest Margin (NIM) and Growth in Net Profit (GINP). For this purpose, data of three public, three private and three foreign commercial banks were used. There were not significant differences of profitability among public, private and foreign banks before and after 2008. However, there is a significant difference in Net interest Margin before and after 2008 global financial crisis which shows that the financial crisis has affected the interest income of banks. On the other hand, other profitability indicators appear to remain unchanged after the global financial crisis. This indicates that banks compensated their decreased interest earnings with an increased income from financial services such as fees, commissions and other income. Keywords: Bank profitability, state banks, private banks, foreign banks, Turkey.