Turkish finance is principally founded upon a universal banking system. Banks operate in accordance with international rules and practices and offer a wide variety of services at their numerous branches. Turkey has already accepted EU practices on capital adequacy. Following the recognition of Turkey as a candidate country for the EU full-membership, the new banking law that came into force was another significant step of this harmonisation of regulations. In addition, investment and development banks may not accept deposits.
Turkey has an active and open system made up of state-owned banks and private banks.
3 of the development and investment banks were state-owned while 12 of them were privately owned and the remaining 3 were foreign banks. The existence of foreign banks is a reflection of the progressive internationalisation of Turkey's financial system. Despite their small market share, foreign banks have an important place in the Turkish banking system because of the new concepts and practices they have introduced. Accelerated by the liberalisation movements of the 1980s, a continuous modification and diversification process took place in the entire economy and it was widely reflected by the reforms made in the financial system. Some of these reforms were the establishment of the Interbank Money Market, the introduction of new tools for the regulation of liquidity, and legal arrangements to promote the development of the capital market.