Watchdog permits Emlak Katılım to conduct operations

ISTANBUL

Turkey’s banking industry watchdog BDDK has authorized the participation bank Emlak Katılım to conduct operations.

BDDK’s decision was published on the Official Gazette on Feb. 27.

In August last year, President Recep Tayyip Erdoğan said that Emlak Bankası would become operational again.

The banking license of Emlak Bankası was revoked in 2001. When it was active, the bank had focused mainly on the housing sector.

The headquarters of Emlak Katılım Bankası will be in Istanbul.

Three private and two state-run participation banks - Kuveyt Türk, Albaraka, Türkiye Finans, Ziraat Katılım, and Vakıf Katılım - are currently active in Turkey, with over 1,100 branches and 15,650 employees. Emlak Katılım will be the sixth participation bank.

Participation banks are interest-free, Islam-compliant banks.

As of the end of 2018 their net profit was $403 million and assets were $39.2 billion, according to data from BDDK.

Turkey’s participation banking sector will grow over 30 percent in 2019, Osman Akyüz, the head of the Participation Banks Association of Turkey, said earlier this month.

He also said participation banks’ share of the Turkish banking sector is around 5 percent but they want to raise it to 15 percent.