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ADFIMI Workshop on "The use of Islamic Finance Instruments in Development Finance”, Mövenpick Hotel, Istanbul, Turkey, 23-24 April 2014

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After the welcoming remarks, Mr. Nuri Birtek, Secretary General of ADFIMI and WFDFI, gave the floor to Mr. Osman Nihat Yılmaz, Deputy Secretary General of Participation Banks Association of Turkey to make his opening remarks.

He was pleased and honoured to be at the workshop on behalf of Participation Banks Association of Turkey to deliver the opening remarks. He emphasized that Islamic Banking is basically a different type of development banking. Because Islamic Banking stipulates real sector relation and 100 % real economic activity, it prohibits interest, uncertainty, risky and speculative transactions, unlimited financial growth etc. So, it doesn’t include toxic and excessive risky assets. In the meantime these factors lead to the efficient use of limited economic and financial resources.

The amount of

“…mudarabe and musharake, we call them profit and loss partnership investments, are too little. Because existing economic and financial conditions are not convenient for them. First, funds collected and funds extended by the participation banks don’t match in tenor. Because while the average tenor for collected funds is 3 months, for extended funds, it is minimum 2.5 years. This creates liquidity and credit risk for the banks…”

“…in Turkey, our another missing item in development finance is microfinance. We don’t have any microfinance bank and our banks don’t extend adequate micro finance…”

Mr. Mehmet Emin Özcan, Chairman of ADFIMI; Vice Chairman of Vakifbank Turkey, had also welcomed to the participants and thanked to the resource persons for their presence. He also noted the importance of Islamic banking and described his long Islamic finance and banking experience. He has emphasized the importance of Islamic finance as it has grown between 15 to 20 percent annually and its volume exceeded about 1,5 Trillion US Dollars in the world. He wished that the participants could reap their expectations from the workshop.

There were three resource persons at the Workshop:

The first resource person was Mr. Mehmet Serdar Kabukcuoğlu, Head of Business Development and Strategy Dept., Development Bank of Turkey. His presentation was divided into two parts. In the first part he had focused on development banking; after giving an extensive definition of development banking, he has continued with characteristics, structure, and sources of development banking, as well as difference from the commercial banks.

In the second part of his presentation he described the modes of development finance (like SME financing, microfinance, infrastructure finance, PPP finance, sustainable finance, inclusive finance, equity finance, entrepreneurship, technical assistance and capacity building, loan-project cycle, project appraisal -technical appraisal, economic appraisal, financial appraisal, eligibility criteria-).

Mr. Osman Çelik, Executive Vice President, Türkiye Finans Participation Bank was the second resource person. He had deliberated on Islamic Finance and its instruments.

He had divided his presentation into three parts. In the first part he has defined what Islamic finance is, what the reasons are to push the people choose Islamic finance against conventional finance. He also gave some data (like breakdown of the Islamic finance sector, Islamic banking market share, volume of Islamic finance as of 2012, and so on).

In the second part, he described Islamic finance instruments and categorized them into four categories as 1) finance models based on spot sale contract (like Murabaha Financing, L/C Murabaha, İjarah Financing, Musharakah Mutanakisa), 2) finance models based on forward sale contract (like Istisna (Manufacturing Contracts), Salam (Forward Sale), 3) finance models based on profit-loss partnership (like Mudharaba, Musharakah) and 4) other Islamic finance models (like Commodity Murabaha (Tawarruq), Wakala). He had also spared attention to Sukuk and underlined the models of Sukuk (like Mudharaba Sukuk, Musharakah Sukuk, Murabaha Sukuk, Salam Sukuk, Ijarah Sukuk).

The first day ended with a Q&A session.

Dr. Osman Babiker Ahmed, Lead Training Specialist, Training Division, Islamic Research and Training Institute – Islamic Development Bank was the last speaker of the workshop.

He described IsDB’s practices on the Islamic Finance Instruments that were used in financing infrastructure and strategic projects as well as IDB’s specialized financing through the IDB Group Entities and IF Instruments used trade finance and Intra-Trade Promotion (ITFC), role of IDB in development of private sector: through ICD and, IDB enhancing facilities provided through ICIEC (Shari'ah - compliant insurance to credits and project).

Last session of the second day there was a panel which was co-chaired by Mr. Osman Çelik, Executive Vice President, Türkiye Finans Participation Bank; and Dr. Osman Babiker Ahmed, Lead Training Specialist, Training Division, Islamic Research and Training Institute – Islamic Development Bank where Mr. Yavuz Yeter, Assistant General Manager of Ziraatbank of Turkey; Dr. Abdel Hameed Jameel, CEO of Workers National Bank of Sudan and Mr. Mehmet Serdar Kabukcuoğlu, Head of Business Development and Strategy Dept., Development Bank of Turkey were panellists.

There were 19 participants from 8 institutions coming from 5 countries.

The event ended after an evaluation and certificate ceremony. Mr. Nuri Birtek made concluding remarks. Certificates were presented by sequentially by the resource persons as well as by panellists.


End of Seminar an evaluation form was distributed by ADFIMI to the participants of the s/m workshop.

According to results the participants had graded the lecturers for their presentation at average of 5,23 out of 6 (corresponding to 87%) and they also graded the quizzes and group discussion at average of 5,27 out of 6 (corresponding to 88%).

Also the participants had found the workshop as about right for their level of responsibility.

The participants have graded the materials as “well suited for use in this seminar” where they graded the length of the workshop as “just right” as well.


A Gala Dinner was organized by ADFIMI at the roof restaurant of Istanbul Saphire Mall on 23 April 2014 and a social programme on 25.04.2014.

Mr. Mehmet Serdar Kabukcuoglu's Presentation (only for members)

Mr. Osman Celik's Presentation (only for members)

Dr. Osman Ahmet Babiker's Presentation (only for members)


Date : 28 April 2014
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