Abstract
Financial systems and companies have become the most important reasons in the weakness of world economic system. The formation and development process of the financial structure also constitute the infrastructure of the world economic system. The path of the financial system and development has led to discuss with the financial crisis in 2008-2011. One of the solutions in order to reduce problems caused by the conventional banking system is alternative financing systems. In Turkey, the corporations based on profit share system are named participation banks. These banks which settle on different principles in the risk distribution of the portfolio acquired are analyzed more nowadays. Participation based banks are placed in practically every regulation related to banking terms and get their legal infrastructure more steady in the banking legislation of Turkey. This study is a continuation of a series related to the situation of participation banking in Turkey. On the other hand, the literature and the history of participation banking have been given less attention in this study. Literature information on methods in participation banks has been described in previous work of the series. Two analyzes were conducted in this study. One analysis is interpretive analysis that expresses the situation of applications of participation banking against banking risks. The other is an analysis of the figures of participation banks in Turkey as a continuation of the series. This study is a 2007-2015 part of research series. The study tries to explore the place and the importance of participation based banking with the various sub-headings, especially in Turkey. For this reason, we examine the comparative review 2007-2015 data of participation banks which are composed of Total Assets, Equity Net Profit, Collected Funds and Bank Loan Funds. Then we compare the total figures with deposit banks for the same period in Turkey.
Highlights
Participation banks gather funds from saving owners, use them in industrial and trade sectors according to the interest free financing ethics and shares the profit or loss with saving owners
Especially in Muslim countries, there are many financial institutions that operate according to a similar system. Even if it is known as "interest-free banking" or "Islamic banking", the system consisting of such institutions operating through profit and loss is perceived as a "special finance house" and later defined as "participation banking" under Turkish law
As of the end of 2015, total funds collected by participation banks reached to approximately 74 billion Turkish Liras, after an increase of 400% compared to the end of 2007
Summary
Participation banks gather funds from saving owners, use them in industrial and trade sectors according to the interest free financing ethics and shares the profit or loss with saving owners. Even if it is known as "interest-free banking" or "Islamic banking", the system consisting of such institutions operating through profit and loss is perceived as a "special finance house" and later defined as "participation banking" under Turkish law. I. The Position of Participation Banks against General Risks Related to Banking
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