turkish-arab economic forum
DESCRIPTION
Turkish-Arab Economic Forum. Panel 6: Potential for Islamic Banking and “ Sukuk ” for Financing Major Projects in Turkey. Hasan Genç Head of Enforcement Department Banking Regulation And Supervision Agency-BDDK. Islamic Banking implementation in Turkey Hasan GENÇ Head of Department - PowerPoint PPT PresentationTRANSCRIPT
Turkish-Arab Economic ForumPanel 6: Potential for Islamic Banking and “Sukuk” for Financing
Major Projects in Turkey
Hasan GençHead of Enforcement Department
Banking Regulation And Supervision Agency-BDDK
2
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
2
Islamic Banking implementation in Turkey
Hasan GENÇHead of Department
Banking Regulation and Supervision Agency
3
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
3
Scope
Brief HistoryRegulatory FrameworkSome Key PointsFinancialsSukuk Regulation
4
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
4
History
⌂ Decree of the Council of Ministers - (1983)
(Special Finance Houses)
⌂ The Banks Law –(1999)(Special Finance Houses)
⌂ The Banking Law – (2005)(Participation Banks)
5
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
5
HistoryRegulatory FrameworkSome Key PointsFinancialsSukuk Regulation
6
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
6
Regulatory Framework
⌂ Basically - Same rules
⌂ Specific provisionsDefining funding & financing methods
⌂ Some differences
Provisions Capital Adequacy
7
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
7
Types of Funding
Participation fund
Special current account
Participation account
Pool of special funds
8
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
8
Financing Methods
Corporate & Individual Financing Support (Murabaha)
Profit & Loss Sharing Investment (Musharakah )
Joint investments (Joint venture -Musharakah)
Financial leasing (Ijarah)Financing of Documents against Goods
9
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
9
Regulatory Framework - Provisions
⌂ Special and general provision accounts set aside for loans extended from participation accounts are reflected in accounts of expenses and accounts of participation according to the rates of participation in losses.
⌂ Participation banks, may set aside a portion of up to %5 of the profit to be distributed to participation accounts as provisions for use to meet the provisions.
10
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
10
Capital Adequacy Ratio
⌂ Loans extended from the participation accounts are taken into account 70% of their values in balance sheet in calculation of credit equivalents for calculating the credit risk
⌂ In calculation of Tier-II capital general reserves the sums of general provisions reflected by these banks in their expense accounts are taken into consideration.
11
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
11
HistoryRegulatory FrameworkSome Key PointsFinancials Sukuk Regulation
12
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
12
Some Key Points
⌂ Deposit Guarantee Scheme
Assurance Fund
Savings Deposit Insurance Fund
⌂ Shariah Board
No regulatory obligation
⌂ Islamic window
Not allowed
13
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
13
HistoryRegulatory FrameworkSome Key PointsFinancialsSukuk Regulation
14
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
14
Participatios Banks, as of December 2012⌂ 4 Participation banks (3 foreign shareholder
control)
⌂ 38,78 billion USD total assets
⌂ 26,48 billion USD loan
15
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
15
Share in Banking Sector (%)
16
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
16
The Growth of Total Assets and Loans
17
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
17
Capital Adequacy Ratio (%)
18
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
18
Loan to Deposit Ratio (%)
19
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
19
Loan/Total Assets (%)
20
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
20
HistoryRegulatory FrameworkSome Key PointsFinancialsSukuk Regulation
21
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
21
Sukuk Regulation
⌂ Sukuk Regulation - Capital Market Board – 2010
⌂ A new Regulation Draft
More Detailed - 4 Kind of Sukuk Murabaha Sukuk Musharaka Sukuk Ijara Sukuk Wakala Sukuk One SPV
⌂ Subordinated debt
22
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
22
Prospects…
⌂ More foreign investors
⌂ State Banks
⌂ Licensing
⌂ Sukuk issuance
⌂ Retirement Funds
⌂ Other…
23
BANK
ING
REGU
LATI
ON A
ND S
UPER
VISI
ON A
GENC
Y
23
THANK YOU