On Tuesday, the board confirmed that the bank’s general directorate office now has the authority to push ahead with the $300 million financing.
In early August deputy prime minister responsible from the economy, Ali Babacan said that the Turkish government wanted to see the establishment of three Islamic banks as subsidiaries of the current state-run conventional banks by the end of 2015.
VakifBank issued a statement on Tuesday: “On December 22, 2014 our Board of Directors licensed the general directorate office of our bank to procure a loan of $300 million under guarantee of treasury from the Islamic Development Bank (IDB) for the establishment of a participation bank.”
The Banking Regulation and Supervision Agency on 15 October issued a certificate giving permission to Ziraat Bank, the second largest in Turkey, to establish an Islamic operation with $300 million capital. Ziraat became the first state-run bank to open an Islamic branch.