Turkey to increase involvement in Islamic finance (By IFN)

Turkey to increase involvement in Islamic finance

Daily Cover

TURKEY: Testament to the republic’s desire to increase its foothold in the global Islamic finance industry, the Turkish government’s 8th Turkish-Arab Economic Forum is expected to see discussions on the potential of Sukuk as a funding vehicle for the country’s development projects, as well as the launch of the Istanbul Financial Center (IFC), which is said to be funded via Sukuk. The forum, to be held on the 4th April, will be attended by a delegation of government representatives, including the republic’s prime minister, Recep Tayyip Erdogan and deputy prime minister for Economic and Financial Affairs, Ali Babacan. Other GCC government officials, including the investment minister of Egypt and governor of the Central Bank of Kuwait are also expected to be involved in the event. The construction of the IFC is spearheaded by Turkey-based construction and real estate conglomerate Agaoglu Group, which has announced its plans to issue the first tranche of its US$2 billion Sukuk this month, worth an estimated US$250 million, for the financing of the IFC. Gulf investors are also becoming increasingly interested in the republic’s participation banking sector, with 35% of Bank Asya’s US$250 million Sukuk issued last month being taken up by Middle Eastern investors. The country’s participation banking sector also saw an advance of 25% in total assets to TRY70.2 billion (US$38.75 billion) in 2012, while its collective net income also grew by 19% to TRY916 million (US$505.58 million). A current hotbed for European and Gulf investors alike, Turkey’s participation banking sector is expected to thrive, moving forward.