Dubai Islamic Bank (DIB)’s board of directors have agreed to purchase a 25% stake in a new digital banking group in Turkiye.
Subject to regulatory approvals, the proposal is part of the bank’s international expansion strategy and will serve as DIB’s gateway into the Turkish market.
The name of the digital banking group was not disclosed.
DIB is the UAE’s largest Shariah bank by assets, with over US$75 billion in assets and more than US$10 billion in market capitalization. Serving over five million customers across the group, DIB has presence in Indonesia, Kenya, Sudan, Pakistan and Bosnia through its subsidiaries and associates.
It posted a net profit of AED1.5 billion (US$408.41 million) in the first quarter, up 12% year-on-year. During the release of its Q1 2023 results, DIB confirmed that the bank will continue to enhance its digital capabilities as part of its growth plans.
Investing in a digital banking group is no surprise considering how fintech is thriving in Turkiye, a country noted for its deep Islamic finance potential. In fact, Malaysian conglomerate Boustead Holdings, which operates businesses in the financial services, real estate and agricultural sectors among others, in June last year signed an MoU with Turkiye’s Great East Capital (GEC) to establish an Islamic digital bank.
According to the Participation Banks Association of Turkiye, the Islamic Republic is home to 615 active fintech start-ups and six fully-fledged participation banks as at the end of 2022.