ISTANBUL- Akbank, Garanti and Isbank have applied to Turkey's competition authority to take over 55 percent of Turk Telekom , the competition watchdog said on Thursday.

The 55 percent stake is owned by Dubai-based Oger Telecom, which has failed to keep up payments on a $4.75 billion loan it took out in May 2013 to acquire a stake in the Turkish fixed-line operator. 

The banks applied to take over the majority stake via a special purpose vehicle (SPV), the watchdog also said.

The three banks declined to comment.

In May, sources told Reuters that the creditor banks were set to take majority control of the company as part of a debt restructuring.

Turk Telekom shares were trading up 5.68 percent after the competition regulator's announcement.

Among Oger Telecom's creditor banks, Akbank  extended $1.7 billion, Garanti lent it some $1 billion and Isbanksome $500 million, according to the banks' first-quarter financial statements.

(Reporting by Can Sezer Writing by Ezgi Erkoyun Editing by Daren Butler and Jane Merriman) ((ezgi.erkoyun@thomsonreuters.com; +90-212-350 7051; Reuters Messaging: ezgi.erkoyun.thomsonreuters.com@reuters.net;))