The banking sector in Turkey and the role of the BRSA (Banking Regulation and Supervision Agency)

This master's thesis examines the historical evolution of the Turkish banking system from the Ottoman Empire to the present day and analyzes the role undertaken by the Banking Regulation and Supervision Agency (BRSA) within this process. The study focuses on the structural transformations experienced by the banking sector, particularly the financial vulnerabilities observed during the 1990s and the early 2000s, and how these developments necessitated comprehensive regulatory reforms. The establishment of the BRSA as an independent regulatory authority in 1999 represents a significant turning point in the Turkish banking system. Within the framework of the Transition to a Strong Economy Program implemented after the 2001 crisis, regulatory and supervisory reforms led by the BRSA contributed positively to improvements in capital adequacy, asset quality, and overall financial soundness of the banking sector. In this context, the BRSA's macroprudential policies and the harmonization process with international standards, particularly the Basel Accords, are evaluated. In addition, the regulatory framework in Turkey is comparatively analyzed with the financial regulation and supervision model applied in the United Kingdom. The study also examines the role of these regulatory practices in enhancing the resilience of the banking sector against external shocks such as the 2008 Global Financial Crisis. The findings indicate that the BRSA's proactive regulatory and supervisory approach has strengthened transparency, corporate governance, and financial stability within the banking system. Nevertheless, ongoing debates regarding the operational independence of the institution are also addressed. This thesis aims to contribute to the literature on financial regulation and supervision in Türkiye and to offer policy implications for the sustainable development of the banking sector.