Turkish banks saddled with 18,000 properties including Bosporus villa
Turkish banks have acquired ownership of more than 18,000 properties during recent economic turmoil including a 25 million-lira ($4.5 million) Bosporus villa.
The 23 banks are selling the properties at a 25 percent discount to get them off their books, local media including Posta newspaper reported. The number totals more than 20,000 if you include real estate that has not yet been processed, it said.
Half the portfolio, acquired after clients failed to repay their debts, are made up of residential buildings, Posta said. The remainder include factories, land, shops and educational facilities, it said.
Turkey’s economy has undergone extreme turmoil after a currency crisis peaked last summer. It is now growing tentatively, but the bad loans on banks balance sheets are continuing to increase. Many companies have also sought to restructure their debts with the lenders, leaving properties and other immovables as security.
Some banks now have so much property on their books that they have set up special departments to deal with the assets, according to Posta. They are also using intermediary auction companies such as Intengo and tapu.com, it said.
The properties also include a newly built 22.5 million-lira building below Istanbul’s Galata Tower and a ballroom in Ankara worth 4 million liras, the newspaper said.
Auctions are held by post. Applicants are required to put down a guarantee totalling between 2 percent and 15 percent of the guide price, Posta reported. Winning bidders are required to pay in cash for the properties but can apply to banks for a mortgage to finance the deals.
Banks can offer the properties at a cheaper price because they are not required to pay taxes on the sales, Posta said.