Germany gears up to open first Islamic bank

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Monday 23 Mar 2015 - 13:54 Makkah mean time-3-6-1436 Berlin (IINA) – Turkish lender Kuveyt Turk said on Sunday it would launch Germany’s first full-fledged Islamic bank in July, a first step intended at offering Sharia-compliant retail banking services across the continent. The wholly-owned subsidiary will be called KT Bank AG and use Frankfurt as its base, aiming to tap Europe's second-largest Muslim community, many of whose members are of Turkish descent. The subsidiary would seek to serve Germany’s roughly 4 million Muslims but also target a wider client base, expanding its branch network across the country and later into the rest of Europe, Reuters reported quoting a bank statement. Kuveyt Turk, the largest Islamic bank in Turkey and 62 percent owned by Kuwait Finance House, set up a financial services branch in Mannheim in 2010 and applied for a full banking license in 2012. At the time, the lender said it would invest initial capital of 45 million euros ($48.7 million) in the planned German unit. Islamic finance has been slow to gain a foothold in Europe due to a fragmented market and lack of industry-specific regulations. Britain remains Europe's main Islamic finance hub, with five full-fledged Islamic banks, with a Luxembourg venture also planning to launch an Islamic lender of its own. In 2004, the German state of Saxony-Anhalt raised 100 million euros via Islamic bonds, with Munich-based FWU Group tapping the market in 2012 and 2013. HA/IINA