ISTANBUL (Sept 23): Turkish lender Turkiye Finans Katilim Bankasi plans to issue $50 million worth of ringgit-denominated sukuk (Islamic bonds) in Malaysia by year end in a step aimed at diversifying its funding base, Chief Executive Derya Gurerk told Reuters.

Turkiye Finans, in which Saudi Arabia's National Commercial Bank is the largest shareholder, raised 800 million ringgit ($246.8 million) from an Islamic bond in Malaysia in July. It was its first issuance from a 3 billion ringgit programme announced in June with sukuk of one to 20 years.

"Malaysia is the centre of sukuk, it's the largest market. We want to diversify our resources. That's why we issue ringgit-denominated sukuk," Gurerk said in an interview, adding that the lender may also issue a 100 million lira ($44.7 million) sukuk by February.

Turkiye Finans's borrowing from abroad rose to 7.3 billion lira as of June 2014 from 150 million in June 2011, Gurerk said. In August it issued a 139 million lira sukuk.

Turkey Finans is one of the four Islamic banks in the country, with a sole focus on loans to corporate clients.

Gurerk said the lender expects growth of around 14 percent in net profit to around 100 million lira in the third quarter compared with the same period of last year, and 18 percent growth in loans and deposits in the first nine months.

The bank plans to raise the number of its branches to 280 by the end of the year from a current 275, Gurerk said.

($1 = 3.2420 Malaysian ringgit)
($1 = 2.2370 Turkish lira)

(Tues 23/09/14 18:51:17)