Eurobank Tekfen's Sale To Burgan Bank Has Been Officially Finalized

Shares of Eurobank EFG and Tekfen Group in Eurobank Tekfen were transferred to Burgan Bank after the Banking Regulation and Supervision Agency gave due permission for the transfer on December 6 2012. As a result, banking activities that started under the structure of Tekfen in 1989 officially came to an end.

Tekfen Group's history in the banking sector dates back to 1989 when Tekfen Investment and Finance Bank Incorporated Company was founded. Until that time, the group focused its investments mainly on construction and industry sectors. The fact that Tekfen Group encountered difficulties in contract works abroad led the group to venture in banking. The process during which Tekfen increasingly opened up to foreign countries as an international contractor during the 1980s, was simultaneously accompanied by the need for project finance. Companies that could finance the projects themselves gained an advantage in international competition.

Tekfenbank, which received its establishment license on August 26, 1988 following the Council of Ministers' decision, started its activities in the middle of 1989. In fact, the bank's foundation application was made as a deposit bank. However, the Undersecretariat of Treasury and Foreign Trade gave Tekfen Group the license of investment and finance banking with the rationale that there were enough deposit banks in the market. As a result, Tekfenbank operated with a single branch for long years.

Spain's third biggest bank Banesto purchased % 10 share of Tekfenbank in 1990 which spruured the bank’s activities. Tekfenbank has been a representative of slow but determined growth in the banking sector since its inception and fortunately did not incur any problems during the 1994 financial crisis. What’s more, the bank was also able to turn the 2001 financial crisis, where several banks were obliged to shut down, into an opportunity and purchased Bank Ekspres, a medium-scaled commercial bank. Thus, the dream of many years was finally realized, paving the way for Tekfenbank to become a deposit bank.

Achieving a crucial boom with the purchase of Bank Ekspres, Tekfenbank increased its number of branches to 30 at the beginning of 2002. Tekfenbank's administration had developed two alternative strategies after its purchase of Bank Ekspres: either going public and resuming with growth or uniting with a foreign partner. Meanwhile, foreign finance circles increased their interest in Turkey's banking sector after the mid-2000's, thereby making the second option more feasible.

As a matter of fact, negotiations that started with Eurobank EFG, Greece's second largest bank, in May 2005 matured quickly and the two banks signed a partnership agreement on May 8, 2006. The agreement stipulated that 70% of Tekfenbank's shares would be transferred to Eurobank EFG. In the meantime, Tekfen Group continued to be a strategic partner with a share of 29.26%. The bank's name was changed to Eurobank Tekfen as of January 11, 2008 following the fulfillment of legal procedures and the share transfer.

Eurobank Tekfen displayed a fast growth between 2006-2012 and raised the number of its branches to 60. Eurobank Tekfen has become a significant business partner especially for small and medium-sized enterprises in crucial commercial and industrial regions of Turkey. Turkey's exuberant and growing economy enabled the bank administration to look to the future with confidence.

However, Eurobank EFG decided to scale down in 2011 due to the deepening financial crisis in Greece and decided to sell its shares in Eurobank Tekfen. After Eurobank EFG declared on April 9, 2012 that it is going to sell its shares to Kuwaiti Burgan Bank, Tekfen Group also announced that it is going to transfer its % 29,26 shares to the same bank. At the same time, both banks started operations for obtaining the approval and permission of all public enterprises to which the parties were liable. With the required permission granted by the Banking Supervision and Regulation Agency on December 6 2012, Eurobank Tekfen and all its subsidiaries (EFG İstanbul Equities, and EFG Leasing) were officially transferred to Burgan Bank as of December 21, 2012.