Turkey's banking watchdog has approved the sale of privately owned Turkish Islamic lender Turkiye Finans to Saudi Arabia's National Commercial Bank, a BDDK official told Reuters on Friday.
Last July, National Commercial Bank, the Gulf's largest lender by assets, agreed to pay $1.08 billion (Dh3.96 billion) for 60 per cent of Turkiye Finans.
The BDDK official, speaking on condition of anonymity, said a statement would shortly confirm the approval of the sale.
Turkey's Islamic banks, which do not charge or pay interest but reward depositors with a share of their profits, saw assets grow 27 per cent in the first nine months of 2007, albeit from a low base.
Islamic banks only control 3 per cent of Turkey's overall banking assets but their share is expected to more than treble.
Officials have told Reuters they expect Turkiye Finans to see asset growth in 2008 to at least match last year's 36 per cent.
The boom in Islamic banking comes as Turkey's strong economic growth has increased wealth in the mainly Muslim but secular country and provincial businessmen have become successful while holding onto conservative religious values.
The centre-right, pro-business AK Party government, which has roots in political Islam, has also helped such lenders by giving them fully fledged banking status in 2006. Islamic banking executives deny receiving any special treatment. (Reuters)
Saudi purchase of Turkish bank approved