Ankara
Medium-term growth prospects for Islamic banking in Turkey are supported by the segment’s strategic importance to the authorities, the growth appetites of, and record of capital support for, the state Islamic banks and Turkey’s favourable demographics, Fitch Ratings says in its report “Turkish Islamic Banks Dashboard: 2021”.
However, constraints to segment growth remain from low public awareness, the banks’ limited distribution networks and product ranges, and a lack of product standardisation.
Turkish Islamic banks’ market share rose to 7.2% of total banking sector assets at end-2020 (end-2019: 6.3%).
Rapid segment financing growth was underpinned by the Credit Guarantee Fund and the Asset Ratio requirement in 2020, and creates seasoning risks given the operating environment pressures. —Agencies
