(Adds details, background)
ISTANBUL, March 4 (Reuters) - Turkey's banking watchdog said
on Wednesday regulators had taken control of a small stake in
embattled Islamic lender Bank Asya
The partial seizure was a fresh blow to the bank after regulators last month took management control of Bank Asya, caught up in a feud between President Tayyip Erdogan and U.S.-based Muslim cleric Fethullah Gulen, whose followers set it up.
The BDDK watchdog said Turkey's Savings Deposit Insurance Fund (TMSF) seized shares held by publishing company Surat Basim and construction firm Forum Insaat because of irregularities in the January sale of their parent company to a Dutch firm.
Initial attempts by Reuters to reach the two companies for comment were unsuccessful.
The parent company Kaynak Holding, is close to Gulen's 'Hizmet' (Service) movement, like most other shareholders in Bank Asya. Kaynak holds 6.47 percent of the bank's shares.
As of November last year, Surat Basim and Forum Insaat held a total of 6.55 percent of Bank Asya, according to the bank's regulatory filings. The BDDK statement said only preferred shares were seized, but did not specify the size of the holding.
Bank Asya depositors, including state-owned firms and institutions, last year withdrew 4 billion lira ($1.7 billion), or some 20 percent of its deposits, according to media reports.
Shares in Bank Asya, of which around 54 percent are publicly traded, were moved to the stock exchange's watchlist market in September, where companies are kept under surveillance. The shares trade for a limited time each day.
(Reporting by Ece Toksabay; Editing by Daren Butler/Jeremy Gaunt) ((firstname.lastname@example.org; +90 212 3507052; Reuters Messaging: email@example.com))
Keywords: TURKEY BANKASYA/