Vakıf Katılım Celebrates Its 5th Anniversary

Hosted by Board Chairman Öztürk Oran and General Manager İKRAM GÖKTAŞ, an online press conference was held to celebrate the 5th anniversary of Vakıf Katılım.

It was stated in the meeting that Vakıf Katılım, which celebrated its 5th year in the sector, aimed for a 50% growth by the end of the year. Öztürk Oran stated in his speech at the meeting that the participation finance model catered to not only Muslim societies but to the whole of humanity, and it was the only system that could prevent global economic crises.

Talking about how the sector contributed to the country's economy with its more balanced structure and activities to ensure a fairer income distribution, Oran stated that the importance of the values that the model embraced were proved once again during the pandemic and added: "The participation finance model shares both the risk and the revenue. It advocates that not only individual but also social growth and development are necessary."

Oran also stated that they took important steps to bring dynamism to the sector and take the participation finance model to the levels it deserves, always with an approach to carry the ancestral foundation culture to the future generations.

"Participation finance has a 7.2% share in the banking sector"

He said that the participation finance sector in Turkey now ranks 9th in the world with assets worth $63 billion, according to the Islamic Development Bank's Corporation for the Development of the Private Sector (ICD) report. Also pointing out that the serious attempts and important advantages of Turkey to become the centre of the participation finance sector, Oran added:

"Our country stands out to be the centre of Islamic Finance with its central geographical position in the world, on the main transfer route of the East's energy to the West, and its duty as a role model with the important steps it takes for the development of the participation finance system. I would also like to emphasise the support of the political authorities to develop the participation finance system in our country. The fact that the public sector is now an active player in the participation finance sector is one of the most important indicators of this. By the end of 2020, our sector grew by 60.7% in the extended funds compared to the end of 2019, contributed to the markets with a TRY 240.1 billion, and reached TRY 437.9 billion increasing by 53.7% in asset size. And this increased the share taken from the banking sector to 7.2%. Right now, 17,000 people are employed in our sector."

"There is nothing in Turkey's path to prevent it from becoming the participation finance centre of the world."

Emphasising how the global shareholder economy-oriented new searches, people-oriented, and sustainable growth approaches are increasingly adopted and that this approach should be turned into an advantage for the participation finance model, Oran said, “We can seize new opportunities with bigger steps towards meeting innovative and various issues such as green, sustainable, and hybrid sukuk. Our country has amazing potential. We are right in the middle of the global financial markets of Asia and Europe. We are meeting a majority of the criteria to be the participation finance centre of the world with our cultural heritage, geopolitical location, economic size, and hinterland.

We need to continue our activities on the topics of Sectoral Strategy and Coordination, Product Diversity and Development, Advisory Boards, Education, HR and Certification, Corporate Communication, Perception and Reputation, all of which were mentioned in the Participation Banking Strategy Document. We can develop and improve participation finance model in a sound and sustainable way with activities revolving around these topics and become the centre of the world in this area."

"Our asset size increased by 75.2%"

And İkram Göktaş, General Manager at Vakıf Katılım said, "Although we are relatively young in the sector, we have achieved great things in a very short time with the strength that we take from the hundreds of years of experience in the foundational culture and the powerful vision of Turkey and had the biggest issued capital of the participation finance sector."

Reminding that Vakıf Katılım's total issued capital increased up to TRY 5 billion 720 million, Göktaş said they are pleased that this increase in the capital brought about an important growth in their total business volume and enabled them to provide more inclusive opportunities.

Göktaş also talked about the 2020 financial outcomes of Vakıf Katılım and their future goals, adding:

"We carried on our activities with great determination during the pandemic, taking all the necessary measures in our units to prevent any interruption in our economic activities and country's production. We actively took part in the Economic Stability Shield Package, which was implemented for the sake of our country's financial stability. We catered to the needs of every segment of society with the financing packages that we offered. Also, we stood by our SMEs and individual customers with Credit Guarantee Fund supported credits. We achieved the highest amount of domestic TRY lease certificate issuance in one day with our sukuk issuances, contributing to the development of participation finance capital markets. All our activities allowed us to reach an asset size of TRY 53.2 billion in 2020 with a 75.2% increase compared to the previous year, and our collected funds reached TRY 39.6 billion with an increase of 72.4%. We increased our support to the real sector with both strong funding resources and equity by 58.8% compared to the previous year and provided a total of TRY 43.1 billion in cash and non-cash funds. As part of our strategy to get more closer to our customers, we opened more branches, leading up to 117 in 43 cities, and increased the number of our employees to around 1,700.

"We have a transaction volume of approximately 160 tons of gold and 415 tons of silver"

Stating that their transaction volume in the Precious Metals And Diamond Markets of Istanbul Stock Exchange reached approximately 160 tons of gold and 415 tons of silver as part of their projections to be the National Gold Institution of Turkey, Göktaş also expressed that they continued their digital transformation journey and had 61% of their customers using their digital banking platform and performed 87% of their fundamental banking transactions through digital channels in the last quarter of 2020.

"We extended a total of TRY 15.8 billion cash and non-cash financing to our SMEs by the end of 2020. And we have successfully completed the issuance of lease certificates of approximately TRY 27.4 billion in 123 series in total since June 2017. With this capital increase, our institution will contribute more to the needs of the tradespeople, industrialists, and individual customers from now on," he said.

Stating that they will continue to utilise new opportunities meticulously in line with their aim of profitable and sustainable growth, Göktaş added, “We will focus on working and producing this year, as we have always done, which will focus on the fight against the pandemic and economic reforms. We aim to achieve a growth of 40-50% in almost every item at the end of the year and to increase our success at every step. We will never shy away from taking responsibility for our country in the upcoming period, as we have always done."