Turkey's Bank Asya swings to 877 mln lira net loss in 2014

Turkish Islamic lender Bank Asya, whose management was taken over by regulators earlier this year, swung to a net loss of 877 million liras ($336 million) in 2014 on shrinking loans and deposits.

The bank, in which Turkish banking regulators seized a small stake last week over an alleged illegal share sale, had reported a net profit of 180.6 million liras in 2013.

Loan loss provisions amounted to 1.45 billion liras in 2014, almost half of which came in the final quarter, the bank said. Bank Asya wrote off 943 million worth of loans in 2014.

Loans and deposits contracted 24 percent and 12 percent respectively in the fourth quarter.

Bank Asya was founded by followers of Islamic cleric Fethullah Gülen. Depositors in Bank Asya, including state-owned firms and institutions, last year withdrew several billion liras from the lender, amounting to about 20 percent of its deposits, according to media reports.

Regulators last month took over the management after the government said it had failed to meet some legal criteria.

The banking watchdog BDDK said last week that Turkey?s Savings Deposit Insurance Fund (TMSF) had seized preferred shares in Bank Asya held by a publishing company and a construction firm, citing irregularities in the sale of their parent company, Kaynak Holding, to a Dutch firm in January.

Bank Asya denies any irregularities.