ISTANBUL: Turkey’s Akbank plans to increase its capital by 30 percent to 5.2 billion lira ($966 million) through a rights issue, it said on Wednesday.
Akbank will receive 3 billion lira ($558 million) in proceeds from the issue, which is to be used to improve its capital base and solvency ratios, the bank said in a stock exchange filing.
“The bank has taken this decision to protect itself from the possible impact of the expected increase of NPLs in the upcoming period, due to the depreciation of lira and slowdown in economy,” said Bulent Sengonul, equity research manager at Is Investment.
“In my opinion, capital raising by a bank with a strong capital standing like Akbank might trigger similar moves from other banks,” Sengonul said.
The bank reported a capital adequacy ratio of 18.48 percent, above the required legal limit, and an NPL ratio of 3.3 percent in its third-quarter financial results.
The lira slumped in August, at one stage falling as much as 47 percent from its level at the start of the year.
