Billions of liras in follow-up at public banks: CHP's Akdoğan issues Demirören reminder

CHP Ankara MP Umut Akdoğan made a statement regarding data on non-performing loans included in the 2022 Court of Accounts reports for Ziraat Bank, Halkbank, and Vakıflar Bank. Akdoğan stated that the Court of Accounts identified hundreds of "bad loans" in the accounts of these three public banks.

DEMİRÖREN REMINDER

Akdoğan said the following:

"While it is on the agenda that Demirören Holding has not repaid the approximately 900 million dollar loan it used to purchase Doğan Media and owes the bank 25 million dollars in interest, scandals regarding 'bad loans' at public banks have been revealed by Court of Accounts reports. A total of 224 billion TL in loans granted by the three public banks to hundreds of companies since 2003 is under close follow-up. Loans under close follow-up consist of loans that must be monitored closely due to reasons such as negative developments observed in the borrower's repayment capacity or cash flow, or the expectation that such developments will occur, or because the borrower carries significant financial risk. Therefore, we can say that the collection of this 224 billion TL from the companies is becoming increasingly difficult. 

Ziraat Bank, to which Demirören Holding has not repaid its approximately 900 million dollar debt, has placed 91.7 billion TL of loan debt under follow-up, while recording 11.6 billion TL of this as 'loss' and 1.2 billion TL as 'doubtful' in its balance sheets. Halkbank, which has placed 51.8 billion TL of loan debt under close follow-up, has evaluated 11.1 billion TL of loan debt as 'loss' and 2.18 billion TL as 'doubtful for collection'. When we look at Vakıflar Bank, we see that 81.2 billion TL of loans are under close follow-up, 15.8 billion TL of which has been written off as 'loss' and 2.1 billion TL of which is doubtful for collection."

BAD LOANS

Asking, "So, how do these bad loans end up like this?" Akdoğan said, "We see that despite the Court of Accounts' warnings to firms regarding the loan granting processes of independent institutions in the reports, these loans are given with eyes wide open. A FAR (Financial Analysis Report) is prepared for many firms before loan allocation. Warnings are issued regarding risks such as cash flow risk, liquidity risk, and resource procurement risk, but loans are still granted to these firms. When debts are not paid, they are restructured repeatedly, and interest rate cuts are made."

Akdoğan noted the following:

"For example, a firm in Gebze currently has a debt of 1 billion 195 million TL in return for a loan it used in 2018. The reports make an assessment that it could pay it off in 35 years. In other words, this firm will be able to pay its debt in 35 years at the earliest, and that is only if it complies with the restructuring. A loan was given in 2004 to a firm with two thermal power plants, then a restructuring was made for 425 million TL with a 1-year grace period and a 5-year total term, and 620 million TL with a 2-year grace period and a 7-year total term; that was not enough, and the firm's limits, which were 275 million dollars, were increased to 325 million dollars. It was restructured again in 2019, restructured again in 2022, and that was not enough; an additional 450 million TL loan was given. Its current debt is 3.8 billion TL, and it is unclear when it will be paid."

ROBBERY IN THE PUBLIC SECTOR

Pointing to a loan granted in 2010, Akdoğan added, "The firm's debt to the bank is 296 million TL. There is a criminal complaint against a person who is the sole shareholder of the firm for the crimes of fraud and forgery of official documents. The MASAK (Financial Crimes Investigation Board) investigation is ongoing. For example, Vakıflar Bank has 540 customers that it has restructured many times in this way but has never been able to collect from, and these loans amount to 2.1 billion TL. Again, for loans of 10 million TL and above restructured by Vakıflar Bank, the debt of 505 loans from 136 customers amounts to 39.3 billion TL," he said.

Akdoğan concluded his words as follows:

"We examined the Court of Accounts' reports and saw that the three public banks have effectively 'poured a glass of water' over 38 billion TL in loan debt. While citizens are left in need of pennies and poverty is rampant, these three public banks have been recklessly distributing public money to crony contractors and crony housing firms for years. Then they do not pursue these debts. Public banks are practically being robbed; there is literally a robbery in the public sector."