Sukuk

The Islamic lending arm of Turkey's state-run Ziraat Bank has applied to sell 1.5 billion lira ($501.9 million) worth of Islamic bonds, or sukuk, according to Turkey's Capital Markets Board (SPK).

Fitch Ratings said it expects Turkish Islamic banks' loan growth to remain above the sector average, supported by new entrants to the market and increasing penetration, despite intense competition from conventional banks in a written statement on Jan. 25. 

Deputy Prime Minister Mehmet ?im?ek has said preparatory work to launch a coordination mechanism for Islamic banking in Turkey have started, and the related circular note has recently been sent to the Prime Ministry. 

Emerging markets must create the valid legal conditions and a "level playing field" to gain access to Islamic finance at the international level, Zamir Iqbal, the head of the World Bank Global Islamic Finance Development Center, has told Anadolu Agency.

The Turkish government is seeking to increase the use of Islamic finance for state agencies, state-owned companies and the private sector, a senior treasury official has said.

The chairman of Turkey's main stock exchange, Borsa Istanbul, said the term "Islamic finance" should be changed to "Finance of Islam," as the income inequality problem could be solved through an interest-free Islamic finance model. 

Saudi Arabia will cut spending and issue more bonds as it faces a record budget shortfall due to falling oil prices, the finance minister said on Sept. 6.

Turkish Islamic lenders Türkiye Finans and Albaraka Türk have applied separately to issue Islamic bonds, or sukuk, according to Turkey?s Capital Markets Board (SPK). 

Türkiye Finans, a sharia-compliant lender which has a focus on loans to corporate clients, has applied to raise up to 1.5 billion lira ($513.2 million) through its wholly-owned unit, TF Varl?k Kiralama.

The Islamic sukuk or bond market is set to drop sharply this year after Malaysia's Central Bank, one of the largest global issuers, stopped doing so, Standard & Poor's said on July 7.

Islamic finance continues to expand globally but the industry risks losing its differentiation from conventional financial products and lacks official data to ensure better supervision, an oversight body said.