US urges Ankara to observe int’l standards after Bank Asya takeover

Bank Asya takeover

The United States has urged the Turkish government to observe international legal standards after the authorities seized Turkey’s biggest Islamic lender in a move that is widely interpreted as a politically motivated financial crackdown.

An official from the US State Department, who wanted to remain anonymous, said they have seen the reports that Turkey’s state insurance fund took over Bank Asya but referred to the Turkish government on the specifics of seizure.

“Broadly speaking,” the official said, “we look to governments, including Turkey, to ensure that monitoring of corporate and financial activity is done in accordance with international legal standards.”

Turkey’s Banking Regulation and Supervision Agency (BDDK) announced late on Friday that it had handed over control of the bank to the state-run Savings Deposit Insurance Fund (TMSF) after a months-long political campaign targeting the bank.

Bank Asya, founded by sympathizers of Turkish Islamic scholar Fethullah Gülen, has been targeted by President Recep Tayyip Erdoğan ever since a corruption scandal implicating people in his inner circle erupted in December 2013. Erdoğan blames the Gülen movement — also known as Hizmet (service) — for the investigation, which it brands a “coup attempt.”

As Erdoğan’s war on the Gülen movement intensified, Bank Asya depositors, including state-owned firms and institutions, last year withdrew TL 4 billion ($1.7 billion), or some 20 percent of its deposits, reportedly under pressure from Erdoğan.

Pro-government newspapers carried almost daily reports on Bank Asya’s woes earlier last year, portraying it as a failing bank being propped up by members of the Gulen movement. The government also canceled tax collection and social security payment contracts with Bank Asya in August, while Erdoğan has on several occasions publicly targeted the bank, claiming it has poor financials and even once declaring that the bank had already sunk.

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