Citi cements Turkey foothold after 32 years

Citi has become the latest western bank to launch an equities business in Turkey after buying local broker Opus Menkul Değerler. The bank has had offices in Turkey since 1975 but now will be able to work on local deals without using an intermediary broker.


Merrill Lynch, Credit Suisse, UBS and Morgan Stanley have all bought local brokers in the last 18 months, in order to obtain broking licences.

Citi appointed Savas Divanlioglu as chief operating officer and top-ranked Turkish analyst Akin Tuzun as head of equity research to lead Citi's Turkish equity research product.

Nick Harwood, head of equities for Central and Eastern Europe, the Middle East and Africa at Citi, said the acquisition is an important step in the bank's ongoing investment into emerging markets. "Emerging markets comprise a growing component of our client's investment remit, which underscores Citi's commitment to offering investors direct access to the major international markets. The establishment of our Turkey equity franchise underscores Citi’s longstanding commitment to emerging markets and compliments our well established CEEMEA businesses in the Middle East, Russia, South Africa, and Poland."

Citi will apply to the capital markets board in Turkey to change Opus’s name to Citi Menkul Değerler AŞ after the close of the acquisition. Clients ranging from mutual funds and institutional investment managers to hedge funds will all be able to tap into a full service brokerage offering equity trading and research services.

Steve Bideshi, chairman of Citibank AŞ said: "Turkey’s equity market capitalisation has grown seven fold in the last five years and the depth of the market has increased commensurately. This acquisition provides a fast and efficient route to position ourselves in the market”.

Banks have been flocking to tap into the country's liquid and rapidly growing market. In May, Credit Suisse bought broker Baran Securities, which deals mainly in equities. The purchase gave it a broker-dealer licence on the Istanbul Stock Exchange and it will offer equity sales, trading and research.

Intesa Sanpaolo, Italy’s largest retail bank, was reported earlier this year to be preparing a €1.1bn ($1.5bn) offer to buy Turkey’s Oyak Bank, which France’s Crédit Agricole and the UK’s Standard Chartered had been eyeing last year. Merrill Lynch set up operations in the country in February, five months after it bought lender and broker Tat Yatirim Bankasi. Merrill is expanding its Turkish team.

Lehman Brothers is targeting the market, having promoted Uzay Kozak to chief executive of Turkey with a view to setting up a local office. UBS last year agreed to buy broker Ari Menkul Kiymetler.

Morgan Stanley bought broker Arigil Menkul Degerler last November and a month earlier Citigroup acquired a 20% stake in Akbank, Turkey’s largest private bank, for $3.1bn.
Source: efinancialnews.com