Abstract. In this paper I investigate the concentration and competition in the Turkish banking sector by looking at the recent empirical evidence that covers the period from 2005 to 2010. I look at concentration indicators for different balance sheet items including total assets, loans, and deposits. I find that the degree of concentration did not show a big change since 2005; in fact for some balance sheet items it decreased. Besides that, using Panzar and Rosse's methodology, I look at the competition in Turkish banking sector during this period. I find that the Turkish banking sector is characterized by monopolistic competition and the degree of competition has decreased over the relevant period.

Keywords: competition; concentration; banking industry.