Recent development

On October 30, 2014, Türkiye Halk Bankası A.Ş., better known as Halkbank, one of the largest Turkish state-owned banks, announced that its board of directors has authorized management to establish an Islamic bank.

Currently, Turkey has four Islamic banks, all privately owned. Earlier this year, T.C. Ziraat Bankası A.Ş., the largest Turkish state-owned bank, also received approval from the Turkish Banking Regulatory and Supervisory Authority to establish a Turkish Islamic bank.

Conclusion

Halkbank's official announcement of moving forward with an Islamic bank and Ziraat Bank's authorization to set up another show the Turkish government is keen to develop the Turkish Islamic banking market. It also demonstrates Turkey's drive to diversify the financial products and financing sources currently available to Turkish investors.