Abstract
<span lang="EN-US">In this research paper, the quarter data has been collected from Turkish Central Bank in order to determine the relationship between economic growth, FDI and participation banks of Turkey over the periods of 2002 - 2014. Several econometrical models have been implemented to reveal this relation among variables. In this context, it has been found that there is a long-term linkage between economic growth, FDI and breakdown of participation funds in Islamic banking by implementing Johansen co-integration test. On the other hand, according to Granger causality test (GCT), when the lag number is 3, there is a bidirectional relationship between GDP and participation funds in Islamic banking. According to results of both Johansen co-integration and Granger causality test, the contribution of Islamic banking to*the economic growth of Turkey is so vital. The linear regression analysis has to be used to reply the research questions. The results indicated that there is the considerable impact of GDP on Islamic bank deposits in Turkey which is founded 0.0006.</span>
Highlights
The financial growth characterized as a rise in the volume of financial requirements of banking institutions and financial transactions on capital markets
Islamic banking deposit is determined as dependent variable and Gross Domestic Product (GDP) and FDI is determined as the independent variable
GDP was determined as an independent variable to comprehend the impact on Islamic banking deposits and the results indicated that there is the considerable effect of GDP on Islamic bank deposits in Turkey which is founded 0.0006
Summary
The financial growth characterized as a rise in the volume of financial requirements of banking institutions and financial transactions on capital markets. The banking institution performs a *growth-promoting role if it can steer financial resources towards the industrial area that demand those most. When the banking institution and its sector are more advanced, more financial assets can be distributed into production channel and it can promote economic development. There are nearly 270 Islamic banking institutions worldwide including total market capitalization of Islamic banking at more than $ 13 billion. The total assets of participation bank are predicted as $ 265 billion and required investments are more than $ 400 billion. Breakdown of participation funds in Islamic banking are forecasted at above of $ 202 billion among 10 – 20 percent globally. Islamic bonds are estimated as $ 30 billion and Islamic equity funds are estimated as $ 3.3 billion globally by around 25 % at last decade and the worldwide Takaful premium is calculated approximately as $ 2 billion
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