Turkish entrepreneurs optimistic – UBS-Campden Wealth

Business leaders are optimistic about Turkey’s business prospects, with 88% of participants planning to expand domestic operations, a research conducted by Campden Wealth in collaboration with UBS revealed.

The report Turkish Wealth Builders: Family Businesses Cultivate Economic Growth, which survedy 29 Turkish wealthy families during the summer and autumn of 2013, explores how leading Turkish business families are shifting attention toward planning for the future and implementing strategies to create cross-generational legacies.

The report highlighted that wealth management is still a very family business in Turkey and that for Turkish wealth owners trust comes first when it comes to making investments.

More than 90% of participants expect to fund their business development with internal cash flows, with almost 60% saying they also plan to raise debt.

Half of Turkish entrepreneurs surveyed currently have more than 75% of their total wealth invested in their business, allocating the remainder to real estate holdings and investment-grade fixed income securities. Those remaining Turkish entrepreneurs, who have divested more than 25% of their wealth from the operating business, have invested predominately in real estate, private equity and liquid deposits.

Local banks are held in high regard: more than 80% of participants have accessed capital from local banks within the last 12 months, compared to 29% using international banks.

Opportunities reside with next generation of Turkish business leaders
Coupling higher rates of educational achievement with international travel experience, the next generation of Turkish wealth builders appear primed to adopt more sophisticated business and wealth management mechanisms.

“The findings suggest a shift in how wealth is managed in the country, which creates the opportunity for global wealth managers and family office service providers to tap into the market by focusing on the next generation of Turkish wealth builders,” concludes Dominic Samuelson, CEO of Campden Wealth.

While the economy is forecasted to grow by 4% over the next two years1, the next generation of Turkish Wealth Builders face a host of macroeconomic challenges – including a current account deficit, high interest rates and a weakened lira – to make their marks in business and
investing. Wealth management professionals may get a chance to prove themselves in the coming years.

Gonca Gürsoy Artunkal, CEO of UBS Turkey, added: “From liquidity concerns to an increased interest in governance structures, these findings reinforce what we’re seeing in the market, underpinning our strategy to support our Turkish clients. As a prominent wealth manager with a key focus on private business owners, UBS is pleased to support this study in an effort to deepen our understanding of client needs, which will help to enhance and adapt
our client offering.”

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