BANKING - 2.5 tons of gold move from ‘under the pillow' to Bank Asya accounts

www.todayszaman.com -Turkey's leading participation bank Bank Asya's General Manager Abdullah Çelik has said that they have taken in 2.5 tons of gold since March as a result of a campaign to transfer what is called the "under-the-pillow" precious metals as functioning assets to the national economy.

Offering customers a chance to open a time deposit gold account in Bank Asya, the "golden account" program was first introduced on March 19.  (source)

BANKING - Bank Asya Expects to Double Gold Deposits, Haberturk Reports

www.bloomberg.com - Asya Katilim Bankasi AS (ASYAB), an Istanbul-based Islamic bank, expects its gold deposit accounts to double by the end of this year, Haberturk newspaper reported, citing Chief Executive Officer Abdullah Celik.

The bank, also known as Bank Asya, currently has 1 ton of gold stored in such accounts and plans to pay a profit-share to attract more customers, Celik said, according to Haberturk. Profit share is a mechanism used by Islamic lenders that corresponds to interest payments.  (source)

ARTICLE - The Behavior of Conventional and Islamic Bank Deposit Returns in Malaysia and Turkey

Author/Editor: Cevik, Serhan ; Charap, Joshua

Authorized for Distribution: July 01, 2011

Summary: This paper examines the empirical behavior of conventional bank deposit rates and the rate of return on retail Islamic profit-and-loss sharing (PLS) investment accounts in Malaysia and Turkey, using monthly data from January 1997 to August 2010. The analysis shows that conventional bank deposit rates and PLS returns exhibit long-run cointegration and the time-varying volatility of conventional bank deposit rates and PLS returns is correlated and is statistically significant. The pairwise and multivariate causality tests show that conventional bank deposit rates Granger cause returns on PLS accounts. These findings have policy implications in terms of price stability and financial stability.

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BANKING - Central bank to pay interest on Treasury deposits

Original post : http://islamicfinanceturkey.blogspot.com/2010/09/finance-bankers-take-hit-from-turkish.html

A motion to end the treasurer’s role of the Central Bank of Turkey has been warmly welcomed by economists.

The most important item in a debt restructuring package prepared by the government is seen as the change in the treasurer role of the central bank. Due to this change, the Finance Ministry can now earn interest on its fund of approximately TL 20 billion that is deposited in the central bank. Since the bank has accumulated a significant amount of funds, the interest payments will not overburden the Central Bank of Turkey.

FINANCE - Bankers take hit from Turkish Central Bank

Turkey’s Central Bank increased Thursday the level of reserves banks must deposit at the central financial institution as it announced it would cease paying interest on Turkish Lira reserves.

“The decision means the bank has completely reversed the 2 percentage-point cut it made in the foreign currency reserve requirement in December 2008,” Bloomberg reported about the move, which is likely to soak up the liquidity provided to markets during the global financial crisis.