March 21, 2023

BSP, Turkish bank in talks to boost Islamic finance in the country

The Bangko Sentral ng Pilipinas (BSP) is in discussions with a Turkish bank to help establish Islamic banks and Islamic banking units (IBUs) in the Philippines, according to BSP Deputy Governor Chuchi G. Fonacier.

The Turkish bank is the third financial institution to approach the regulator about promoting Islamic finance in the country.

Fonacier said that the Turkish bank’s aim is to assist in establishing Islamic banks and IBUs in the country, despite being an Islamic bank themselves.

The BSP previously held talks with two banks to set up IBUs in the country before the pandemic, but the discussions did not continue due to the global crisis.

Fonacier added that the BSP is still receiving feedback from potential players regarding the easing of the minimum capital requirement for IBUs, which is currently the same as that for universal banks.

The Al Amanah Islamic Bank, under the Development Bank of the Philippines, is the sole Islamic bank currently operating in the country.