THE ROLE OF STRATEGIC MANAGEMENT IN DEVELOPING BANK PERFORMANCE AND PROFITABILITY – A CASE STUDY OF ALBARAKA TÜRK PARTICIPATION BANK (2019–2025)

Abstract

This study examines the role of strategic management in developing the performance and profitability of Albaraka Türk Participation Bank during 2019-2025, a period marked by high inflation, exchange-rate volatility, regulatory change, and accelerated digitalisation in Türkiye. A mixed-methods single-case design was applied. Qualitative evidence from annual and integrated reports was analysed through PESTEL, SWOT, and content analysis, while audited financial data were evaluated using trend analysis, financial ratios, Pearson and Spearman correlations, partial correlations controlling for consumer-price inflation and the USD/TRY rate, DuPont decomposition, and a sensitivity analysis of the 2025 provision reversal. The annual sample comprised seven observations. Total assets rose from TL 51.4 billion in 2019 to TL 466.4 billion in 2025, while year-end-balance ROA increased from 0.12% to 2.83% and ROE from 1.66% to 52.05%. Asset quality improved substantially, and capital adequacy reached 19.00% in 2025. NPL was strongly and negatively related to ROA and ROE in bivariate tests, but these associations were not significant after macroeconomic controls. CAR retained a significant positive partial association with ROA, whereas the CAR-ROE relationship was marginal. CIR was negatively but non-significantly related to profitability. Sukuk activity, financing diversity, digital-product innovation, and digital-transaction penetration were strategically important but could not be tested reliably because consistent seven-year series were unavailable. Excluding the non-recurring 2025 provision reversal reduced estimated ROA, ROE, and NPM to 1.33%, 24.49%, and 18.73%, respectively. The study concludes that strategic management supported resilience, adaptation, and capacity protection, but the overall null hypothesis could not be conclusively rejected and causal claims are not warranted.