Islamic bank takes first step in selling gold from ATMs

Turkish lender Kuveyt Türk has started selling “gold-on-the-go” from automatic teller machines, or ATMs, fulfilling a promise it made in January.

Speaking at a press conference Tuesday, İrfan Yılmaz, the deputy general manager of the lender, noted that Turkey ranks among the top gold importers.

“A huge portion of this gold is not being exported. It stays within the country,” Yılmaz said. “According to data from the Istanbul Gold Exchange, 2,500 tons of gold were imported in the past 15 years. This amounts to over $100 billion.”

A portion of this amount is exported, while nearly 1,500 tons of gold stays in the country, according to Yılmaz. “This makes $70 billion,” he said.

Noting that gold has a key place in Turkish people’s saving practices, Yılmaz said Kuveyt Türk’s rise in gold banking started with this assessment.

According to data from Kuveyt Türk, the Turkish banking system has around 42 tons of gold. Kuveyt Türk accounts for 20 percent of this amount. The lender’s gold transactions have reached an annual volume of $1 billion.

That compares with its less than 1 percent share of overall Turkish banking assets.

“Gold savings in Turkey, which stood at around 200 million to 250 million Turkish Liras in 2007, rose to 1.2 billion liras last year. The gold savings in banks is over $2 billion,” ” Yılmaz said. “According to estimates, more than 10 percent of national savings is in gold. We are working to attract some of this into the banking sector.”

Gram-gold sales from ATMs, a first in the world, will not bring a huge economic advantage to Kuveyt Türk, according to Yılmaz. Still, he expects “serious demand and transaction volume.”

Customers will be able to buy 1-gram and 2.5-gram gold pieces from ATMs. The service is currently only available at Kuveyt Türk’s headquarters branch. But it is expected to spread to 180 branches in the next year.

Kuveyt Türk is 62 percent owned by the Kuwait Finance House and 18 percent owned by Turkey’s General Directorate of Foundations.

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source : hurriyat daily news

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