TANRIÖVEN, Cihan Gazi Üniversitesi, Turkey , YENİCE, Sedat Gazi Üniversitesi, Turkey

THE EFFECT OF FINANCIAL DERIVATIVES OWNED BY BANKS ON THE RISK AND PROFITABILITY- THE CASE OF TURKEY

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In these days, rising risks requires protection from risks. In this study, the relation between risk and profitability due to usage of financial derivatives is measured for banks. For that purpose, co- integration analysis was used between financial derivatives, risk and profitability for Turkish Banking Industry, publicly owned deposit banks, privately owned deposit banks and foreign owned banks in the period 2002 December- 2014 March . As a result, a positive long term relation was detected between usage of financial derivatives, risk and profitability. Although the effect on risk is more compared to the effect on profitability, increasing usage of financial derivatives increases both risk and profitability.

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Financial derivatives , bank , risk management , co , integration

Journal Of Economics an‎d Administrative Sciences

46