March 26 (Bloomberg) -- Asya Katilim Bankasi AS, caught in a feud between Turkey’s prime minister and an Islamic cleric, posted a record gain after saying Qatar Islamic Bank was in exclusive talks to buy a stake.
The stock closed 23 percent higher at 1.36 lira in Istanbul, the biggest jump since its May 2006 listing. Bank Asya rose 6.7 percent yesterday, before talks were announced. Qatar Islamic Bank, in a separate statement today, said it’s in negotiations to buy a stake in the Istanbul-based lender.
Bank Asya has been under pressure from the government for alleged ties to Islamic cleric Fethullah Gulen, and has declined 32 percent since a graft investigation into high-ranking government officials was made public on Dec. 17, compared with a 10 percent drop in the 16-member XBANK Index. Prime Minister Recep Tayyip Erdogan’s government said the probe is a coup attempt backed by Gulen’s followers.
“We saw some deposit outflows recently due to political discussions” Cengiz Onder, head of investor relations at Bank Asya, said today by phone. “We hope that with this new partnership, we will see those deposits return.”
Onder said the size and terms of QIB’s investment haven’t been settled.
Bank Asya was raised to market outperform from market perform by Ak Investment analyst Hakan Aygun after the announcement. He expects the company to climb to 1.50 lira a share in 12 months.
The possible deal between Bank Asya and QIB comes after Commercial Bank of Qatar QSC acquired 71 percent of Alternatifbank AS last year.
“Bank Asya has always said that they were open to potential partnerships,” Cagdas Dogan, a banking analyst at BGC Partners Inc., said in an e-mail. Recent difficulties “may have accelerated the process,” he said.
The Borsa Istanbul 100 Index added 4.7 percent to 67,730.78, the biggest gain among 94 global indexes tracked by Bloomberg and its highest level since Dec. 30. Yields on two-year benchmark bonds fell 34 basis points to 11.1 percent, their lowest since March 6.
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