The role of foreign capital in turkish banking sector after 1980's: Effects to the financial performance of Turkish banking sector

The aim of this study is to search the effects of foreign capital inflow into Turkish banking sector after 1980s. A variety of performance measurements have been examined during this study. State-owned commercial banks, privately-owned commercial banks and the banks owned by foreign capital have been taken in the scope of this study and the selected ratios/indicators of the relevant banks have been compared with the sector averages. The observations and comparisons have been made mainly on a period of last ten years, between 2009-2019. Foreign capital banks have become the essential actors of the global financial markets. Especially, in the economies of developing countries, the share of foreign capital banks has reached more than half of the banking sector, even in some countries it has reached almost the whole sector. In our country especially in the last two decades, the foreign capital inflow has increased sharply and the ownership status of most of our national private banks has changed by mergers and acquisitions. In addition to that, there is also an increase in the number of new foreign banks which were established and started to operate via getting license from Banking Regulation and Supervision Agency (BRSA) for the last ten years. In the sector, there are also some banks whose foreign owner changed for the second time or even for the third time within years. In this study, the main reasons that attract international banking groups into our country and the effects of the foreign capital inflows into our banking sector have been examined. Key Words: Turkish Banking Sector, Financial Liberalization, Foreign Capital Banks, International Banking Groups, Acquisitions, Mergers, Statistical Analysis, Financial Performance, Bank Ratios, Bank Indicators