Local government banking: The case study for the changing period of İller Bankası

After the declaration of Turkish Republic, in order to provide the required finance and coordination for local governments of after-war country, Bank of Municipalities has been established in the year of 1933. Then for the technical works of local governments Municipal Development Council has been established. With the developments in this area like the rapid increase in population, demand for the infrastructure and need for the credit to finance the technical works, Bank of Provinces has been established in 1945 with the law of 4759. This institution has some technical duties like; mapping, development plans, water and sewage systems, treatment facilities, geological and hydrogeological works, controlling works and providing equipment. Beside this, Bank has given credit to the municipalites with the Municipalites Fund till 2002, the fund has been cancelled. Lastly with its experts, Bank also provides technical assistance to the municipalites. The period in economical changes and globalization of financing funds and looking for new markets for these international funds, bring a big problem to Bank of Provinces. By the regulations coming from the World Bank and European Union to get credit, try to change the institutional structure of Iller Bankası. Municipalites are now given credits with the local sources of this country. But World Bank and European Union want to give credits with the international funds. Todays Iller Bankası is an obstacle for this scenario. So this structure must be changed for World Bank side. A new law has been prepared and waiting for the legislation. To show what kind of changes will be faced up in the future is the aim of this thesis.