Turkey’s Wealth Fund Secures $600M Islamic Financing Without Guarantees, Surprising Markets
TWF
The Turkish Sovereign Wealth Fund has tapped Islamic finance markets for a $600 million murabaha facility without offering collateral—signalling strong confidence from global lenders.
The Turkish Sovereign Wealth Fund (TWF) announced on Wednesday it has signed a five-year, $600 million murabaha financing agreement with a consortium of banks led by Kuwait Finance House. The deal marks a strategic step in diversifying the fund’s financing channels, with a notable focus on Islamic financial instruments.
No Guarantees, High Confidence
Remarkably, the financing was concluded on an unsecured basis, with no guarantees provided. According to the TWF, this reflects the growing trust of regional and international financial institutions in the fund’s creditworthiness, operational stability, and long-term strategy.
With this latest deal, the TWF’s total capital raised via Islamic finance tools now exceeds $1.8 billion, underlining its increasing reliance on sharia-compliant funding solutions.
Backdrop: Policy Shift at the Central Bank
The announcement comes as Turkey’s monetary policy undergoes a major shift. The Central Bank of the Republic of Turkey (CBRT) recently cut its benchmark interest rate by 300 basis points in a single move—from 46% to 43%—marking the first reduction since March.
The rate cut is designed to support price stability and move towards medium-term inflation targets following a period of economic contraction and market volatility.
Restoring Market Confidence
Economists view the CBRT’s decision as a signal of stabilisation in Turkey’s local markets after prolonged political and economic turbulence. The TWF’s ability to raise large-scale funding without guarantees adds to the growing sense that market confidence is gradually returning.
Strategic Role in Islamic Finance
Analysts say the TWF’s growing use of murabaha instruments strengthens its role as a leading player in the regional Islamic finance market, while showcasing Ankara’s ability to attract foreign capital on favourable terms.
“This is not just a funding deal—it’s a statement about Turkey’s financial resilience,” one Istanbul-based market strategist told PA Turkey.
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