Turkey will protect banks from fall-out of Zarrab case, minister says

By Ebru Tuncay and Behiye Selin Taner

ISTANBUL (Reuters) – Turkey’s government will take necessary measures if its banking system is impacted by an ongoing U.S. court case over alleged Iran sanctions evasion, Finance Minister Naci Agbal told Reuters in an interview.

Agbal said Ankara would do whatever was needed to protect the interests of its banks, comments aimed at easing investor concern about the potential fall-out from the trial of an executive of state lender Halkbank (IS:).

“We say if anything is going to happen, in this situation we will stand by the banks,” he said late on Wednesday. “We must not allow any eventuality that would weaken our banking system.”

A wealthy Turkish-Iranian gold trader, Reza Zarrab, has pleaded guilty to charges that he schemed to help Iran evade U.S. sanctions and is testifying in a U.S. court against the Halkbank executive, Mehmet Hakan Atilla, for related charges.

Atilla has pleaded innocent and Halkbank has said all of its transactions have complied with international and domestic regulations. Ankara has said the case is politically motivated and an attempt to undermine Turkey’s economy and government.

International investors have expressed concern that banks could be drawn into the U.S. case.

Agbal also said the government was determined to take all steps to reduce forex volatility.

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