The investigation launched by German officials into the international subsidiary of Turkey’s state-run Ziraat Bank, Ziraat International over concerns of irregularities, is a source of shame for Turkey, opposition lawmaker Erdoğan Toprak said on Sunday.
Seven separate branches of Ziraat International operating in Germany are under investigation after irregularities were determined in loan transactions and the bank’s balance sheet, Cumhuriyet cited the Republican People’s Party (CHP) deputy chairman as saying.
CHP’s Toprak said the investigation marked the second of its kind targeting Turkey’s state-run banks, which was a “source of shame for the country’s banking sector,’’ and damaged the respectability of public financial institutions of Turkey in international banking.
Toprak was referring to the ongoing probe facing Turkey’s state-owned Halkbank.
The state-owned Turkish lender stands accused of bank fraud, money laundering and conspiracyover its involvement in a plot to trade gold for Iranian oil and natural gas, helping Tehran evade U.S. sanctions imposed over its nuclear programme.
The bank has pleaded not guilty to the charges in the case that has complicated Turkish-U.S. relations.
CHP’s Toprak also recalled how the newly-appointed general manager of Ziraat International had been rejected by Germany’s Federal Financial Supervisory Authority (BaFin), citing incompetency for the task.
“This is an altogether different source of shame,’’ the CHP official added.
In 2017, Ziraat Bank became one of the two Turkish public lenders, which cooperated with Reza Zarrab, the Turkey-based architect of the sanctions-busting scheme who pleaded guilty and flipped to be a government witness against Mehmet Hakan Atilla, a deputy CEO of Halkbank, who served 32 months in a U.S. prison before being released in July 2019.