Here is the converted article in markdown format:
Turkey’s Banking Sector: Regulatory Framework and Requirements
The Turkish banking sector is subject to a robust regulatory framework that aims to ensure the stability and soundness of banks. The Bank Act (BankL.) and other relevant regulations provide for a range of requirements that banks must meet in order to operate in the country.
Capital Increase and Funding
According to Article 17 of the BankL., capital increases must be paid in cash, free from all kinds of collusion, without resorting to internal resources (except for those permitted by relevant legislation). This means that banks cannot use their own funds or other resources to increase their capital. Instead, they must raise new capital through external sources.
Regulatory Capital and Liquidity
In Turkey, banks are typically funded through a combination of deposit-taking, bond issuance, and other instruments. Development and investment banks, on the other hand, rely more heavily on funding from the capital market. The banking sector is subject to minimum capital requirements, with:
- Deposit banks required to have a minimum capital adequacy ratio of 10%
- Development and investment banks required to have a ratio of at least 12%
Disclosure Requirements
Banks in Turkey are required to disclose a range of information to regulators and the public, including:
- Financial statements
- Risk policies
- Other relevant data
The Banking Regulation Board (BRSA) has issued guidelines on disclosure requirements for banks, which include the submission of:
- Annual financial reports
- Quarterly financial reports
- Monthly profit and loss statements
Organizational Requirements
Banks in Turkey are required to have a range of organizational structures in place, including:
- A board of directors
- General manager and deputy general manager
- Audit committee
- Credit committee
- Remuneration committee
- Corporate governance committee
- Compliance officer and unit
- Internal control
- Internal audit
- Risk management units
These committees and departments play important roles in ensuring the soundness and stability of the bank.
Corporate Governance
The BankL. requires banks to comply with corporate governance structures and principles determined by the BRSA. The Regulation on Corporate Governance Principles of Banks provides further guidance on these requirements, which include:
- Establishment of a board of directors
- Audit committee
- Credit committee
- Remuneration committee
- Other committees and departments
Conclusion
In conclusion, Turkey’s banking sector is subject to a range of regulatory requirements aimed at ensuring the stability and soundness of banks. These requirements cover capital increase and funding, regulatory capital and liquidity, disclosure, organizational structures, and corporate governance. By understanding these requirements, banks can better navigate the complex regulatory landscape in Turkey and ensure compliance with relevant laws and regulations.