Islamic banking is ‘no more a step child’

Islamic banking is ‘no more a step child’

ISTANBUL - Anadolu Agency
Islamic banking is ‘no more a step child’

Deputy PM Babacan says Turkey is looking for more Islamic banks in the sector. DHA photo

Islamic banking is no more a step child in the Turkish banking regulation, said Deputy Prime Minister Ali Babacan, who is in charge of economy administration, calling on more lenders to show interest in the growing business.

“In terms of legal regulations, our participation banks are no longer our step children, but our own child,” he said while speaking at the general assembly of Turkey’s Union of Participation Banking (TKBB) in Istanbul on May 27.

Turkey entered the sukuk and lease certificate market late, but has achieved great steps, he said.

Recalling that the three state lenders, Ziraat Bankası, Halk Bankası and Vakıfbank are preparing to open up participation banks, Babacan said Turkey was open to prestigious banks with a strong capital structure that would contribute in the sector as long as they fulfill the requirements of the regulation.

“We would like to increase the number of participation banks in the sector and would like to do this via the private sector,” he said.

There are more than 75 participation banks in 75 countries and they have reached a size of assets of %1.7 trillion, Babacan said, projecting that the balance sheet size of such banks in Turkey will reach $121 billion of 2018.

TKKB President Ufuk Uyan said at the assembly that he expected participation banks to launch $1 billion to $2 billion of bonds this year.

Derya Gürerk was picked as the new president and Ahmet Beyaz became his deputy. Uyan remained a board member along with Fahrettin Yahşi.