Türkiye’s state-run largest lender, Ziraat Bank, announced Wednesday that it finalized a $500 million murabaha financing deal with Kuwait Finance House (KFH), aiming to support Turkish exporters.

Murabaha is a widely used Islamic finance instrument in which a financial institution purchases goods on behalf of a client and sells them at a profit margin agreed in advance, avoiding interest payments that are prohibited under Islamic law.

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According to the bank’s statement, the three-year facility is designed to strengthen its access to medium- to long-term foreign funding and bolster Türkiye’s foreign trade capacity, while also helping diversify its external resources and directly contributing to the country’s economic expansion.

Ziraat Bank’s General Manager Alpaslan Cakar stressed that the growing uncertainty in the global economic landscape and recent geopolitical tensions have made alternative financing models and international partnerships increasingly important.

“This high-volume murabaha transaction with Kuwait Finance House, one of the leading financial institutions in Kuwait, clearly demonstrates the trust in our bank and the Turkish banking sector, as well as the deepening cooperation between the two countries,” said Cakar.

Support for exporters and SMEs remains priority

Cakar also noted that the deal would enhance the bank’s ability to provide tailored trade finance solutions to both large corporations and small and medium-sized enterprises (SMEs), a key component of Türkiye’s export-driven economy.

He added that Ziraat Bank plans to pursue similar transactions in the future, leveraging its solid financial structure, extensive correspondent banking network, growing influence in corporate banking and foreign trade, and long-term strategic vision.

June 18, 2025 05:00 PM GMT+03:00