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Turkey’s investigation into banks casts wide net over trading: report

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Turkish competition officials made surprise visits to several private, state and foreign banks late on Friday to analyze computers as they opened a wide-ranging probe of trading in the financial sector, according to three bankers.

Turkey’s Competition Board told Reuters on Tuesday it was conducting “preliminary research” into banks, as it regularly does in all sectors, adding that it could not say more about the effort until the process is completed.

Turkish media reported on Friday that the Competition Board, which is part of the Ministry of Trade, was investigating possible violations in foreign exchange, deposit, credit and brokerage services.

Two Turkish broadcasters have said that more than 20 banks are involved.

Bankers said it was unclear exactly what the competition officials were investigating.

One banker said officials fanned out across Istanbul and simultaneously entered the lenders late on Friday afternoon. They sat down at trading desks to analyze computers and requested more transaction information that is due this week, the person said.

“The investigation that started on Friday was a surprise to us,” said a second banker, who also requested anonymity due to the sensitivity of the subject.

The Competition Board was not working with the Banking Regulation and Supervision Agency (BDDK), which usually does such audits and would have access to some of the information being sought, the second banker said.

“This is why it raises question marks since we don’t exactly know what they are looking for,” the person said. “All operations by banks are being investigated.”

The government has clamped down on financial markets with a series of new rules and regulations since a currency crisis in 2018 knocked nearly 30 percent off the value of the Turkish lira.

The changes — including curbs on foreign exchange and reserve requirements meant to boost lending — were meant to stabilize the currency and kick-start a recovery from recession.

In 2013, the Competition Board fined 12 banks a total of 1.1 billion lira ($620 million at that time) for collusion on interest rates. In 2017, it probed 13 banks over corporate loans.

A senior banker said the latest investigation was routine, while Finance Minister Berat Albayrak was quoted as saying on Monday he had heard about the investigation from the sector.

“There is nothing to be concerned about,” Albayrak was quoted as telling local reporters.

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