News Column

Ziraat extends repayment period for firms paying bribes

February 13, 2014

ISTANBUL (CIHAN)- General Manager HÜseyin Aydin of Ziraat Bankasi, a public bank, who provided loans amounting to $200 million to companies to pay what they had promised government officials in return for favors in public tenders, also promised to smooth the terms of the loan's maturity for those firms, the Taraf daily has claimed.

According to Taraf, the voice records that main opposition Republican People's Party (CHP) leader Kemal KiliÇdaroglu revealed at a group meeting in Parliament on Tuesday feature Aydin telling businessman Mehmet Cengiz that he would extend the repayment period for the firms Limak and Kolin.

Initially, the bank's management did not warm to the idea of lending such a large amount to the businessmen, saying they could loan only $60 million to each. With Aydin's offer, however, the bank's management foresaw a repayment plan of three years after a two-year grace period for the firms' credit loans. The initial repayment plan was for a 10-year period.

But a phone conversation allegedly between Aydin and businessman Cengiz suggests that Aydin said the loan's maturity was kept deliberately short and that he would extend this period later after bypassing the bank's management, the daily reported.

According to an earlier Taraf report, government officials demanded $100 million each from the Limak and Kolin construction companies as bribes for public tenders. The owners of the two companies allegedly agreed but had difficulty in getting the money together, appealing to businessman Cengiz to help them.

There are rumors that the money received from the two construction companies, along with sums from other businessmen, was used by the government to buy the Turkuvaz Media Group, which owns the Sabah daily and ATV network, among other outlets. According to this claim, a pool of $630 million was put together for the purchase of the media group.

The CHP leader said on Feb. 4 that a total of $630 million was collected from eight businesspeople upon the instructions of Prime Minister Recep Tayyip Erdogan to buy the Sabah media group, a pro-government media group that owns dailies and television stations.

Cengiz said he would help the two businessmen and called Ziraat Bankasi's Aydin to find a way to lend them $200 million. Aydin, in response, said he would take care of the problem, Taraf claimed.

Meanwhile, Radikal daily columnist CÜneyt Özdemir wrote on Wednesday that CHP deputy Haydar Akar had asked the government to whom Halkbank lent credit amounting to $250 million, claiming that firms related to the person to whom Halkbank provided this credit already have $575 million in credit from Halkbank and $2.8 billion in debt.

Özdemir maintained that the CHP deputy also claimed that the shareholders of the firms Halkbank was lending money to cannot even pay their credit card debts.

Halkbank was criticized in 2008 for lending Turkey's Çalik Group $375 million in project finance loans to acquire the Sabah media group. Observers at the time said Halkbank risked bad loans by lending that much money. In a separate incident in July of last year, the Turkish media reported that Halkbank was having difficulties collecting outstanding loans of $450 million from a Turkish holding company that allegedly has close ties with the government. Halkbank denied these claims. However, as the company had problems repaying its loans, Halkbank requested extra collateral for its outstanding debts in 2012.

(Cihan/Today's Zaman) CIHAN

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Source: Cihan News Agency (Turkey)

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