IFN.COM - Cover Story - 29-Aug-2011 - Volume8.Issue34
Forbidden fruit: Turkey’s tempting Islamic banking sector economic powerhouse
Turkey has been one of the few economic success stories emerging from the recession, with the highest economic growth rate in the world (11%) in Q1 2011. Despite a dip in 2008 with GDP contracting 14.6%, the economy rapidly returned to growth and GDP grew by 8% in 2010 with a 5% expansion predicted for 2011. Turkish banks were largely unaffected by the global financial crisis, with limited exposure to toxic securities and high retail deposit levels providing a liquidity buffer. The regulator maintains firm control with a focus on preventing excessive credit growth and a ban on foreign currency retail lending, meaning that banks have experienced little funding stress. Fitch Ratings recently changed Turkey’s ‘BB+’ sovereign rating outlook from stable to positive suggesting that a future upgrade could be on the cards, which will only enhance Turkey’s attractiveness to foreign investors. (source)
