The European Central Bank will open a bank account in Turkey in 2019, according to a document seen by Reuters.
The bank, called Bank of Turkey, will be the first Turkish bank to open a branch in the EU since the creation of the euro currency zone in 1999.
The move comes amid growing tensions between Ankara and its Western neighbors over the issue of Kurdish militants fighting for a separate state in northern Iraq and Syria.
The EU, Turkey, and the United States are pressing Ankara to reverse its decision to grant Kurdish groups a seat in an autonomous Kurdish region in Iraq and Syrian.
The Kurdish region, which Turkey regards as an extension of its own territory, has long been at odds with Ankara over its disputed border.
In April, the Turkish government signed a decree allowing Kurdish fighters to form a new autonomous region within Syria.