Albaraka Turk, the Turkish subsidiary of Bahrain’s Al-Baraka Bank, has signed commitments for a $240m loan with a group of regional and international banks.

The loan was originally launched at only $100m, but due to a strong response from banks it was increased in size.

The deal was split between a $98m tranche and a €108.5m ($140m) tranche. Banks were invited to commit either $15, $10, $5m, or $2.5m to the loan. Banks lending to the euro tranche were invited to commit either €12m, €8m, €4m or €2m. Pricing on the loan was 200 basis points and lenders taking the larger ticket sizes will earn fees of 100 basis points, taking the total margin to 300 basis points.

The loan was originally launched at only $100m, but due to a strong response from banks it was increased in size

A total of 22 banks agreed to fund the loan. The deal was arranged by Bahrain’s Arab Banking Corporation (ABC), the UAE’s Noor Islamic Bank (NIB) and the UK’s Standard Chartered (MEED 12:8:10).

The loan is structured as a murabaha, which involves the lenders buying a commodity and immediately selling it to the borrower. They then agree to be repaid at a fixed price based on the cost of the commodity plus profit.

Albaraka Turk will use the money to fund its lending operations in Turkey.