BBVA’s Garanti bid is risky, but has logic

Investors are alarmed at BBVA’s decision to double down on Turkey. The Spanish bank’s share price closed down 4% on November 15, when it announced it was launching a voluntary takeover bid for the 50.12% share it does not own in BBVA Garanti, Turkey’s biggest bank by market capitalization.

President Erdogan Tayyip Erdogan’s recent intervention at the central bank – and the attendant erosion of monetary stability – is obviously not a comfort. The lira has just hit yet another record low.