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���������ֳ�-London/Istanbul-09 December 2011: ���������ֳ� has affirmed four Turkish state-owned or state-controlled banks' Viability Ratings (VR) and Issuer Default Ratings (IDR). The banks are T.C. Ziraat Bankasi A.S. (Ziraat), Turkiye Halk Bankasi A.S. (Halkbank), Turkiye Vakiflar Bankasi T.A.O. (Vakifbank) and Turkiye Kalkinma Bankasi A.S. (TKB). A full list of rating actions is at the end of this commentary.

On 28 November 2011, ���������ֳ� revised these banks' Outlooks to Stable from Positive (see "���������ֳ� Revises Outlook on Turkish Banks to Stable Following Similar Action on Sovereign" at ). These banks' IDRs and Support Rating Floors are equalised with the Turkish sovereign's Long-Term IDRs reflecting ���������ֳ�'s view that the state authorities would seek to support the banks if required. This is based on the state's majority ownership and/or control of the banks. ���������ֳ� considers the authorities' ability to provide such support is moderate given Turkey's sovereign rating of 'BB+'.

Ziraat's 'bb+' VR reflects the bank's extensive franchise, especially in terms of retail and agricultural banking, its strong funding profile, stemming from its core deposit base, sound asset quality and healthy capitalisation. It also reflects its declining but still high volume of government securities. Ziraat is the largest bank in Turkey by branch network and total unconsolidated assets with market share of 14.2% at end-Q311 and is fully owned by the Turkish Treasury.

Halkbank's 'bb+' VR reflects its competitive position given its long track record of managing its core small enterprises (SME) business and improving its retail lending franchise as well as funding through well-diversified stable retail deposits and adequate capitalisation. Profitability is still strong, albeit declining, and asset quality is improving as its non-performing loans (NPL) ratio converges to the sector average. Halkbank has a strong presence in rural areas and it is expanding in large cities with a greater contribution to GDP. Halkbank is the sixth largest bank in Turkey by unconsolidated assets with a market share of 7.8% at end-Q311 and is 75% owned by the Turkish Treasury, with the remainder being free-float.

Vakifbank's 'bb+' VR reflects the bank's strong deposit franchise, solid liquidity and consistent performance as well as the risks from the above market growth in higher risk SME segments. Vakifbank is 58.5% owned by the General Directorate of Foundations (GDF), which is fully-controlled and managed by the Turkish state, 16.1% by the employee pension fund and 25.2% free float. Vakifbank is the seventh-largest bank in Turkey by unconsolidated assets, with a market share of 7.7% at end-Q311.

TKB's Long-Term IDRs reflect the strong likelihood that its 99% shareholder, the Under-Secretariat of the Turkish Treasury, would seek to support the bank, if needed. In line with ���������ֳ�'s policies with regards to development banks a VR has not been assigned to the bank. TKB is a small non-deposit-taking development and investment bank, focusing on providing medium- and long-term project finance and working capital loans in geographical areas that have been identified by the government as high priority. 88% of the bank's total funding provided by international financial institutions was guaranteed by the Turkish Treasury at end-Q311.

The rating actions are as follows:

Ziraat, Halkbank, Vakifbank:

Long-term foreign and local currency IDR: affirmed at 'BB+'; Outlook Stable
Short-term foreign and local currency IDR: affirmed at 'B'
VR: affirmed at 'bb+'
Individual Rating: affirmed at 'C/D'
Support Rating: affirmed at '3'
Support Rating Floor: affirmed at 'BB+'
National Long-term Rating: affirmed at 'AA+(tur)'; Outlook Stable

TKB:

Long-term foreign and local currency IDR: affirmed at 'BB+'; Outlook Stable
Short-term foreign and local currency IDR: affirmed at 'B'
Individual Rating: affirmed at 'D'
Support Rating: affirmed at '3'
Support Rating Floor: affirmed at 'BB+'
National Long-term Rating: affirmed at 'AA+(tur)'; Outlook Stable

Contact:

Primary Analyst (Halkbank and TKB)
Gulcin Orgun
Senior Director
+90 212 284 78 29
���������ֳ� Turkey Finansal Derecelendirme Hizmetleri A.S.
Is Kuleleri Kule 2 Kat 4
34330 4. Levent
Istanbul

Primary Analyst (Ziraat)
Banu Cartmell
Director
+44 20 3530 1109
���������ֳ� Limited
30 North Colonnade
London, E14 5GN

Primary Analyst (Vakifbank)
Turda Ozmen
Director
+90 212 284 7882
���������ֳ� Turkey Finansal Derecelendirme Hizmetleri A.S.
Is Kuleleri, Kule 2, Kat 4

Secondary Analyst (Ziraat)
Gulcin Orgun
Senior Director
+ 90 212 284 7829

Secondary Analyst (Vakifbank)
Janine Dow
Senior Director
+33 1 4429 9138

Secondary Analyst (Halkbank)
Turda Ozmen
Director
+90 212 2847882

Secondary Analyst (TKB)
Levent Topcu
Director
+90 212 2847819


Committee Chairperson
James Watson
Managing Director
+ 7495 956 6657

Media Relations: Michelle James, London, Tel: +44 0203 530 1574, Email: Michelle.James@fitchratings.com.

Additional information is available at . The ratings above were solicited by, or on behalf of, the issuer, and therefore, ���������ֳ� has been compensated for the provision of the ratings.

Applicable criteria, 'Global Financial Institutions Rating Criteria' dated August 2011, 'National Ratings Criteria' dated January 2011, are available at .

Applicable Criteria and Related Research: