ASYA KATILIM BANKASI A.Ş.

Transcription

1 INDEPENDENT AUDITORS LIMITED REVIEW REPORT, UNCONSOLIDATED FINANCIAL STATEMENTS AND NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD JANUARY 1, MARCH 31, 2009 (Convenience Translation of the Financial Statements and Related Disclosures and Footnotes originally issued in Turkish)

2 To the Board of Directors of Asya Katılım Bankası A.Ş. Istanbul INDEPENDENT AUDITORS LIMITED REVIEW REPORT FOR THE PERIOD JANUARY 1, 2009 MARCH 31, 2009 We have reviewed the accompanying balance sheet of Asya Katılım Bankası A.Ş. ( the Bank ) as at March 31, 2009 and the related statements of income, changes in shareholders equity and cash flows for the period then ended. These financial statements are the responsibility of the Bank s management. As independent accountants our responsibility is to issue a report based on the review performed on these financial statements. We conducted our review in accordance with the accounting rules and policies, and the accounting and auditing standards, set out as per the Banking Act No: Those standards require that we plan and perform the review to obtain limited assurance as to whether the financial statements are free of material misstatement. A review is principally limited to reviewing financial statements by applying analytical procedures, inquiring as to the integrity of the financial statements and making inquiries of management to obtain information;it is substantially less in scope than an audit and therefore provides a lesser assurance. We have not performed an audit and accordingly we do not express an audit opinion. Based on our review, nothing has come to our attention that causes us to believe that the accompanying financial statements do not give a true and fair view of the financial position, the results of its operations and its cash flows, of Asya Katılım Bankası A.Ş. for the period ended March 31, 2009 in accordance with the prevailing accounting principles and standards set out as per the Article No: 37 of the Banking Act No: 5411, and other regulations, communiqués and circulars in respect of accounting and financial reporting and pronouncements made by Banking Regulation and Supervision Agency. Additional paragraph for English translation: The effect of the differences between the accounting principles summarized in Section 3 and the accounting principles generally accepted in countries in which the accompanying financial statements are to be distributed and International Financial Reporting Standards (IFRS) have not been quantified and reflected in the accompanying financial statements. The accounting principles used in the preparation of the accompanying financial statements differ materially from IFRS. Accordingly, the accompanying financial statements are not intended to present the Bank s financial position and results of its operations in accordance with accounting principles generally accepted in such countries of users of the financial statements and IFRS. DRT BAĞIMSIZ DENETİM VE SERBEST MUHASEBECİ MALİ MÜŞAVİRLİK A.Ş. Member of DELOITTE TOUCHE TOHMATSU Istanbul, May 5, 2009 Sibel Türker Partner

3 THE UNCONSOLIDATED FINANCIAL REPORT OF FOR THE THREE MONTHS PERIOD ENDED MARCH 31, 2009 Address of the Headquarter of the Bank : Küçüksu Caddesi Akçakoca Sokak No: Ümraniye/İSTANBUL Phone and Fax Numbers of the Bank : / Website of the Bank : Electronic Mail Address to Contact : raporlama@bankasya.com.tr The unconsolidated financial report for the three months designed by the Banking Regulation and Supervision Agency in line with Communiqué on Financial Statements to be Publicly Announced and the Related Policies and Disclosures consists of the sections listed below: -GENERAL INFORMATION ABOUT THE BANK -UNCONSOLIDATED INTERIM FINANCIAL STATEMENTS OF THE BANK -INFORMATION ON THE INTERIM FINANCIAL STATEMENTS OF THE BANK -INFORMATION ON FINANCIAL STRUCTURE OF THE BANK -EXPLANATORY DISCLOSURES AND FOOTNOTES ON UNCONSOLIDATED FINANCIAL STATEMENTS -INDEPENDENT AUDITORS LIMITED REVIEW REPORT The unconsolidated financial statements for the three months and the explanatory footnotes and disclosures, unless otherwise indicated, are prepared in Thousands of the Turkish Lira, in accordance with the Communiqué on Banks Accounting Practice and Maintaining Documents, Turkish Accounting Standards, Turkish Financial Reporting Standards, related communiqués and the Banks records, have been reviewed and presented as attached. May 5, 2009 Tahsin TEKOĞLU Cemil ÖZDEMİR Ünal KABACA Chairman of the Board of Directors and Member of the Audit Committee Vice Chairman of the Board of Directors and Member of the Audit Committee Member of the Board of Directors and General Manager Yusuf İzzettin İMRE Assistant General Manager Responsible of Financial Reporting Kamil YILMAZ Manager In Charge of Financial Reporting Responsible personnel for the questions that can be raised on the financial statements: Name-Surname: Mehmet Arslan Title: Assistant Manager in Charge of Budgeting and Financial Controlling Telephone Number: Fax Number:

4 THE UNCONSOLIDATED FINANCIAL STATEMENTS OF PAGE SECTION ONE GENERAL INFORMATION I. Incorporation Date, Initial Status and Subsequent Changes in the Existing Status of the Bank... 1 II. Shareholding Structure, Shareholders Having Direct or Indirect, Joint or Individual Control over the Management of the Bank and Disclosures on any Related Changes in the Current Year, if any... 1 III. Disclosures on the Chairman & Members of Board of Directors, Audit Committee, General Managers and Assistant General Managers and Their Shares in the Parent Bank... 2 IV. Individuals and Institutions that have Qualified Shares in the Bank... 3 V. Summary on the Functions and Areas of Activity of the Bank 3 SECTION TWO THE UNCONSOLIDATED FINANCIAL STATEMENTS I. Balance Sheet-Assets... 4 II. Balance Sheet-Liabilities. 5 III. Statement of Off-Balance Sheet Contingencies and Commitments... 6 IV. Statement of Income... 7 V. Statement of Profit and Loss Items Accounted under Equity... 8 VI. Statement of Changes in Shareholders Equity... 9 VII. Statement of Cash Flow 10 SECTION THREE ACCOUNTING PRINCIPLES I. Basis of Presentation II. Use Strategy of Financial Assets and Foreign Currency Transactions III. Forward and Option Contracts and Derivative Instruments IV. Profit Share Income and Expenses V. Fees and Commission Income and Expenses VI. Financial Assets VII. Impairment of Financial Assets VIII. Offsetting Financial Assets and Liabilities IX. Sale and Repurchase Agreements and Lending of Securities X. Assets Held For Sale and Discontinued Operations XI. Goodwill and Other Intangible Assets XII. Tangible Assets XIII. Leasing Transactions XIV. Provisions and Contingent Liabilities XV. Liabilities for Employee Benefits XVI. Taxation XVII. Additional Disclosures on Borrowings XVIII. Share Certificates XIX. Acceptances XX. Government Incentives XXI. Segment Reporting XXII. Other Matters SECTION FOUR INFORMATION ON FINANCIAL STRUCTURE I. Capital Adequacy Standard Ratio II. Market Risk III. Operational Risk 24 IV. Currency Risk V. Interest Rate Risk VI. Liquidity Risk... 26

5 THE UNCONSOLIDATED FINANCIAL STATEMENTS OF PAGE SECTION FIVE I. Explanations and Disclosures Related to the Assets II. Explanations and Disclosures Related to the Liabilities III. Explanations and Disclosures Related to the Off-Balance Sheet Contingencies and Commitments IV. Explanations and Disclosures Related to the Income Statement V. Other Disclosures SECTION SIX EXPLANATIONS ON THE INDEPENDENT AUDITORS LIMITED REVIEW REPORT I. Explanations on the Independent Auditors Limited Review Report 66 II. Other Footnotes and Explanations Prepared by the Independent Auditors... 66

6 SECTION ONE GENERAL INFORMATION I. Incorporation Date, Initial Status and Subsequent Changes in the Existing Status of the Bank: Incorporation of Asya Katılım Bankası A.Ş. ( the Bank ) is permitted with the decision of the Council of Ministers No: 96/8041 on April 11, 1996 as published in the Official Gazette dated April 25, The Bank was registered on September 20, 1996 and the Articles of Association was published in the Trade Registry Gazette on September 25, The Decision regarding the change in the title of the Bank was settled in the Extraordinary General Board of Directors meeting dated December 22, 2005 and the title was changed from Asya Finans Kurumu A.Ş. into Asya Katılım Bankası A.Ş. and it was published in the Trade Registry Gazette on December 26, II. Shareholding Structure, Shareholders Having Direct or Indirect, Joint or Individual Control over the Management of the Bank and the Disclosures on any Related Changes in the Current Year, if any: The Bank has no shareholders having more than 10% shareholding or direct or indirect, joint or individual control over the management of the Bank. 1

7 SECTION ONE GENERAL INFORMATION III. Disclosures on the Chairman & Members of Board of Directors, Audit Committee, General Managers and Assistant General Managers and Their Shares in the Parent Bank: Title Name Area of Responsibility Ownership Percentage % Chairman of the Board of Tahsin TEKOĞLU Chairman of the Board of Directors Directors and M ember of the Audit Comittee 0,0178 M ember of the Board of Cemil ÖZDEMİR Vice Chairman of the Board of directors Directors and M ember of the Audit Comittee 0,0026 Tacettin NEGIŞ Member of the Board of Directors 1,2888 Salih SARIGÜL Member of the Board of Directors 0,7311 Ahmet ÇELİK Member of the Board of Directors 0,4467 Murat SUNGURLU Member of the Board of Directors 0,1788 General Manager Ünal KABACA Member of the Board of Directors and General M anager 0,0407 Assistant General Managers Ünsal SÖZBİR Coordinator, Commercial/Corporate Marketing, Business Banking, Treasury and Financial Instutions - Ayhan KESER Credit Allocation, Financial Analysis and Advertising 0,0180 M ustafa BÜYÜKATEŞ Consumer Marketing, ADC(Alternative Distrubition Channels) Marketing and Consumer Loans 0,0072 Yusuf İzzettin İMRE Financial Affairs 0,0056 Buket GEREÇCİ Banking Operations 0,0011 Dr.Mahmut DEMİRKAN Human Resources, Training, Administrative Affairs and Purchase - Ali TUĞLU Information Technologies 0,0017 Group Manager Salim KÖSE Law, Credit and Risk Monitoring - Auditors Ali AKBULUT Auditor 0,0002 Atıf BİLGİN Auditor 0,2667 İrfan HACIOSMANOĞLU Auditor 2,0783 2

8 SECTION ONE GENERAL INFORMATION IV. Individuals and Institutions that have Qualified Shares in the Bank: Name / Commercial Name Share Amount Share Ratio Paid Shares Unpaid Shares ORTADOĞU TEKSTİL TİC. SAN. A.Ş , ABDULKADİR KONUKOĞLU , BJ TEKSTİL TİCARET VE SANAYİ A.Ş , BİRİM BİRLEŞİK İNŞAATÇILIK MÜMESSİLLİK SAN. VE TİC. A.Ş , NEGİŞ GİYİM İMALAT VE İHRACAT A.Ş , FORUM İNŞAAT DEKORASYON TURİZM SAN. VE TİC. A.Ş , OSMAN CAN PEHLİVAN , HASAN SAYIN , İBRAHİM SAYIN , MUAMMER İHSAN KALKAVAN , İRFAN HACIOSMANOĞLU , AYDAN AYDIN SAĞLIK , FEHİM ARICI , YAVUZ EROĞLU , TEKSEN TEKSTİL END. A.Ş , ABDURRAHMAN KOPUZ , Other , Total , V. Summary on the Functions and Areas of Activity of the Bank: The Bank operates in accordance with the principles of interest-free banking as a participation bank by collecting funds through current accounts and profit sharing accounts, and lending such funds through production support, finance lease and profit/loss sharing partnership. The Bank has two ways of collecting funds; current accounts and profit sharing accounts. The Bank classifies current accounts and profit sharing accounts in accordance with their maturities in its accounting system. Profit sharing accounts are classified into five different maturity groups; one month, up to three months (three months included), up to six months (six months included), up to one year (one year included) and one year and more than one year (one month, three months, six months and one year profit share payment). The Bank could determine the participation rates on profit/loss sharing accounts with respect to the maturity group of TRY and foreign currency accounts, seperately under the limitation that the participation rate on loss shall not be less than 50%, for different currency type, amount and maturity groups specifically. The Bank constitutes specific fund pools allocated to the individually predetermined projects for financing purposes. Profit sharing accounts, which are part of the funds collected for project financing purpose, are distinguished from others with respect to the terms, accounted seperately from the others and no transfers can be made from these accounts to any other maturity groups. Specific fund pools are clarified at the end of the financial period. The Bank has no specific fund pools as of March 31, In addition to ordinary banking activities, the Bank operates as an agency on behalf of Işık Sigorta A.Ş. through its branches. 3

9 SECTION TWO THE UNCONSOLIDATED FINANCIAL STATEMENTS

10 BALANCE SHEET THOUSAND TURKISH LIRA CURRENT PERIOD PRIOR PERIOD Reviewed Audited ASSETS Note (31/03/2009) (31/12/2008) TRY FC Total TRY FC Total I. CASH AND BALANCES WITH THE CENTRAL BANK (1) 1,259, ,298 1,761, , ,872 1,129,569 II. FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT AND LOSS (Net) (2) - 15,189 15,189-30,035 30, Trading financial assets Public sector debt securities Share certificates Derivative financial assets held for trading - 15,189 15,189-30,035 30, Other marketable securities Financial assets at fair value through profit and loss Public sector debt securities Share certificates Loans Other marketable securities III. BANKS (3) 5, , ,757 10, , ,917 IV. MONEY MARKET PLACEMENTS V. FINANCIAL ASSETS AVAILABLE FOR SALE (Net) (4) 26,123-26, Share certificates Public sector debt securities Other marketable securities 26,065-26, VI. LOANS AND RECEIVABLES (5) 5,943, ,917 6,453,144 5,875, ,989 6,147, Loans and receivables 5,768, ,665 6,277,167 5,748, ,670 6,019, Loans to risk group of the Bank 208,935 10, , ,643 9, , Public sector debt securities Other 5,559, ,713 6,057,280 5,606, ,073 5,867, Non-performing loans 434,711 2, , ,795 1, , Specific provisions (-) (259,986) (840) (260,826) (195,952) (634) (196,586) VII. HELD TO MATURITY INVESTMENTS (Net) (6) 25,628-25, VIII. INVESTMENTS IN ASSOCIATES (Net) (7) 23,975-23,975 23,975-23, Accounted for under equity method Unconsolidated associates 23,975-23,975 23,975-23, Financial associates Non-financial associates 23,975-23,975 23,975-23,975 IX. INVESTMENTS IN SUBSIDIARIES (Net) (8) 138, , , , Unconsolidated financial subsidiaries 43,285-43,285 43,285-43, Unconsolidated non-financial subsidiaries 94,809-94,809 94,809-94,809 X. ENTITIES UNDER COMMON CONTROL (Net) (9) Consolidated under equity method Unconsolidated Financial subsidiaries Non-financial subsidiaries XI. FINANCE LEASE RECEIVABLES (Net) (10) 170,288 48, , , , Finance lease receivables 191,830 56, , , , Operating lease receivables Other Unearned income ( - ) (21,542) (8,362) (29,904) (31,115) - (31,115) XII. DERIVATIVE FINANCIAL ASSETS FOR HEDGING PURPOSES (11) Fair value hedge Cash flow hedge Hedge of net investment risks in foreign operations XIII. TANGIBLE ASSETS (Net) (12) 225, , , ,626 XIV. INTANGIBLE ASSETS (Net) (13) 6,293-6,293 6,332-6, Goodwill Other 6,293-6,293 6,332-6,332 XV. INVESTMENT PROPERTY (Net) (14) XVI. TAX ASSET (15) 5,098-5, Current tax asset Deferred tax asset 5,098-5, XVII. ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS (Net) (16) 24,100-24,100 24,100-24, Held for Sale 24,100-24,100 24,100-24, Discontinued Operations XVIII. OTHER ASSETS (17) 26, ,479 29,300 1,559 30,859 TOTAL ASSETS 7,879,259 1,240,559 9,119,818 7,254, ,314 8,108,829 The accompanying notes are integral part of these financial statements. 4

11 BALANCE SHEET THOUSAND TURKISH LIRA CURRENT PERIOD PRIOR PERIOD Reviewed Audited LIABILITIES AND EQUITY Note (31/03/2009) (31/12/2008) TRY FC Total TRY FC Total I. FUND COLLECTED (1) 4,464,748 2,322,446 6,787,194 3,603,487 2,239,334 5,842, Fund from risk group of the Bank 69,825 71, ,602 67,967 57, , Other 4,394,923 2,250,669 6,645,592 3,535,520 2,181,924 5,717,444 II. DERIVATIVE FINANCIAL LIABILITIES HELD FOR TRADING (2) - 1,590 1, III. FUNDS BORROWED (3) - 432, , , ,552 IV. MONEY MARKET BALANCES V. MARKETABLE SECURITIES ISSUED (Net) VI. SUNDRY CREDITORS 163,332 1, , ,364 2, ,777 VII. OTHER LIABILITIES (4) 100,966 13, ,530 99,589 9, ,982 VIII. FINANCE LEASE PAYABLES (Net) (5) Finance lease payables Operating lease payables Other Deferred finance lease expenses (-) IX. DERIVATIVE FINANCIAL LIABILITIES FOR HEDGING PURPOSES (6) Fair value hedge Cash flow hedge Hedge of net investment in foreign operations X. PROVISIONS (7) 100,788 14, ,448 94,571 12, , General loan loss provisions 62,319 12,938 75,257 61,625 10,661 72, Restructuring provisions Reserve for employee benefits 19,307-19,307 14,450-14, Insurance technical reserves (Net) Other provisions 19,162 1,722 20,884 18,496 1,591 20,087 XI. TAX LIABILITY (8) 47, ,389 38, , Current tax liability 47, ,389 36, , Deferred tax liability ,250-1,250 XII. PAYABLES RELATED TO ASSETS HELD FOR SALE (Net) (9) Held for sale Discontinued operations XIII. SUBORDINATED LOANS (10) XIV. SHAREHOLDERS' EQUITY (11) 1,456,785-1,456,785 1,403,692-1,403, Paid-in capital 900, , , , Capital reserves 8,020-8,020 7,582-7, Share premium 3,307-3,307 3,307-3, Share cancellation profits Marketable securities revaluation reserve Tangible assets revaluation reserve 4,275-4,275 4,275-4, Intangible assets revaluation reserve Investment property revaluation reserve Bonus shares obtained from associates, subsidiaries and jointly controlled entities Hedging funds (Effective portion) Value increase on assets held for resale Other capital reserves Profit reserves 496, , , , Legal reserves 37,886-37,886 25,561-25, Status reserves Extraordinary reserves 458, , , , Other profit reserves Profit or loss 52,655-52, , , Prior year income / (losses) Current year income / (losses) 52,655-52, , , Minority shares TOTAL LIABILITIES AND EQUITY 6,334,005 2,785,813 9,119,818 5,387,882 2,720,947 8,108,829 The accompanying notes are an integral part of these financial statements. 5

12 STATEMENT OF OFF-BALANCE SHEET CONTINGENGIES AND COMMITMENTS THOUSAND TURKISH LIRA CURRENT PERIOD PRIOR PERIOD Reviewed Audited (31/03/2009) (31/12/2008) Note TRY FC Total TRY FC Total A. OFF BALANCE SHEET COMMITMENTS AND CONTINGENCIES (I+II+III) 6,582,913 6,113,134 12,696,047 6,848,787 6,016,960 12,865,747 I. GUARANTEES (1), (2) 4,202,583 5,412,130 9,614,713 4,600,807 5,614,608 10,215, Letters of Guarantees 4,197,145 4,095,678 8,292,823 4,594,063 4,052,510 8,646, Guarantees subject to State Tender Law Guarantees given for foreign trade operations Other letters of guarantee 4,197,145 4,095,678 8,292,823 4,594,063 4,052,510 8,646, Bank loans - 139, , , , Import letter of acceptances - 139, , , , Other bank acceptances Letter of credits , , ,221,227 1,221, Documentary letter of credits Other letter of credits , , ,221,227 1,221, Prefinancing given as guarantee Endorsements Endorsements to the Central Bank of Turkey Other endorsements Other guarantees 5, , ,094 6, , , Other collaterals II. COMMITMENTS (1), (2) 1,719,761 63,180 1,782,941 1,809,786 5,816 1,815, Irrevocable commitments 1,719,761 63,180 1,782,941 1,809,786 5,816 1,815, Forward asset purchase commitments 15,607 63,180 78,787 1,537 5,816 7, Share capital commitment to associates and subsidiaries 6,869-6,869 6,869-6, Loan granting commitments 68,128-68, , , Securities underwriting commitments Commitments for reserve deposit requirements Payment commitment for checks 430, , , , Tax and fund liabilities from export commitments Commitments for credit card expenditure limits 1,192,506-1,192,506 1,256,191-1,256, Commitments for promotions related with credit cards and banking activities 6,171-6,171 8,067-8, Receivables from short sale commitments Payables for short sale commitments Other irrevocable commitments Revocable commitments Revocable loan granting commitments Other revocable commitments III. DERIVATIVE FINANCIAL INSTRUMENTS (3) 660, ,824 1,298, , , , Derivative financial instruments for hedging purposes Fair value hedge Cash flow hedge Hedge of net investment in foreign operations Held for trading transactions 660, ,824 1,298, , , , Forward foreign currency buy/sell transactions 660, ,824 1,298, , , , Forward foreign currency transactions-buy 660, , , , Forward foreign currency transactions-sell - 637, , , , Other Forward buy/sell transactions Other B. CUSTODY AND PLEDGED ITEMS (IV+V+VI) 71,836,295 65,437, ,273,491 70,017,593 57,208, ,226,302 IV. ITEMS HELD IN CUSTODY 537, ,503 1,367, , ,871 1,373, Assets under management Investment securities held in custody 2,885-2,885 2,885-2, Checks received for collection 400, , , , , , Commercial notes received for collection 134, , , ,260 69, , Other assets received for collection - 502, , , , Assets received for public offering Other items under custody 12 1,343 1, Custodians V. PLEDGED ITEMS 71,298,339 64,607, ,906,032 69,430,251 56,422, ,853, Marketable securities 338, , , , , , Guarantee notes 24,321,545 24,530,552 48,852,097 23,828,375 21,440,634 45,269, Commodity 947, ,690 1,421, , ,811 1,285, Warranty Properties 11,426,745 1,359,091 12,785,836 10,458,296 1,306,210 11,764, Other pledged items 34,263,960 37,921,427 72,185,387 33,843,837 33,040,157 66,883, Pledged items-depository VI. ACCEPTED INDEPENDENT GUARANTEES AND WARRANTIES TOTAL OFF BALANCE SHEET ACCOUNTS (A+B) 78,419,208 71,550, ,969,538 76,866,380 63,225, ,092,049 The accompanying notes are an integral part of these financial statements. 6

13 STATEMENT OF INCOME THOUSAND TURKISH LIRA CURRENT PERIOD PRIOR PERIOD STATEMENT OF INCOME Note Reviewed Reviewed (01/01/ /03/2009) (01/01/ /03/2008) I. PROFIT SHARE INCOME (1) 325, , Profit share on loans 299, , Profit share on reserve deposits 5,574 5, Profit share on banks 13,470 18, Profit share on money market placements Profit share on marketable securities portfolio 1, Held-for-trading financial assets Financial assets at fair value through profit and loss Available-for-sale financial assets Investment-held for maturity Finance lease income 5,018 9, Other profit share income - - II. PROFIT SHARE EXPENSE (2) (172,859) (118,413) 2.1 Expense on profit sharing accounts (165,929) (109,676) 2.2 Profit share expense on funds borrowed (5,583) (7,784) 2.3 Profit share expense on money market borrowings Expense on securities issued Other profit share expense (1,347) (953) III. NET PROFIT SHARE INCOME (I - II) 152, ,664 IV. NET FEES AND COMMISSIONS INCOME 62,671 48, Fees and commisions received 78,679 61, Non-cash loans 41,878 30, Other (12) 36,801 31, Fees and commisions paid (16,008) (13,812) Non-cash loans (1) (73) Other (12) (16,007) (13,739) V. DIVIDEND INCOME (3) - - VI. NET TRADING INCOME (4) 34,375 18, Securities trading gains / (losses) Profit on derivative financial instruments gains / (losses) 7,529 (10,647) 6.3 Foreign exchange gains / (losses) 26,846 29,021 VII. OTHER OPERATING INCOME (5) 33,633 18,253 VIII. NET OPERATING INCOME (III+IV+V+VI+VII) 283, ,472 IX. PROVISION FOR LOAN LOSSES AND OTHER RECEIVABLES (-) (6) (88,632) (61,867) X. OTHER OPERATING EXPENSES (-) (7) (127,957) (94,031) XI. NET OPERATING INCOME/(LOSS) (VIII-IX-X) 66,512 50,574 XII. AMOUNT IN EXCESS RECORDED AS GAIN AFTER MERGER - - XIII. GAIN / (LOSS) ON EQUITY METHOD - - XIV. GAIN / (LOSS) ON NET MONETARY POSITION - - XV. PROFIT/(LOSS) FROM CONTINUED OPERATIONS BEFORE TAXES (XI+ +XIV) (8) 66,512 50,574 XVI. TAX PROVISION FOR CONTINUED OPERATIONS (±) (9) (13,857) (13,235) 16.1 Provision for current income taxes (20,205) (16,668) 16.2 Provision for deferred taxes 6,348 3,433 XVII. NET PROFIT/(LOSS) FROM CONTINUED OPERATIONS (XV±XVI) (10) 52,655 37,339 XVIII. INCOME ON DISCONTINUED OPERATIONS Income on assets held for sale Income on sale of associates, subsidiaries and jointly controlled entities (Joint Vent.) Income on other discontinued operations - - XIX. LOSS FROM DISCONTINUED OPERATIONS (-) Loss from assets held for sale Loss on sale of associates, subsidiaries and jointly controlled entities (Joint vent.) Loss from other discontinued operations - - XX. PROFIT / (LOSS) ON DISCONTINUED OPERATIONS BEFORE TAXES (XVIII-XIX) - - XXI. TAX PROVISION FOR DISCONTINUED OPERATIONS (±) Provision for current income taxes Provision for deferred taxes - - XXII. NET PROFIT/LOSS FROM DISCONTINUED OPERATIONS (XX±XXI) - - XXIII. NET PROFIT/LOSS (XVIII+XIX) (11) 52,655 37, Group s profit/loss 52,655 37, Minority shares - - Earnings per share The accompanying notes are an integral part of these financial statements. 7

14 STATEMENT OF PROFIT AND LOSS ITEMS ACCOUNTED UNDER EQUITY THOUSAND TURKISH LIRA CURRENT PERIOD PRIOR PERIOD Reviewed Reviewed STATEMENT OF PROFIT AND LOSS ITEMS ACCOUNTED UNDER EQUITY (31/03/2009) (31/03/2008) I. Additions to marketable securities revaluation differences for available for sale financial assets II. Tangible assets revaluation differences - - III. Intangible assets revaluation differences - - IV. Foreign exchange differences for foreign currency transactions - - V. Profit/Loss from derivative financial instruments for cash flow hedge purposes (Effective portion of fair value differences) - - VI. Profit/Loss from derivative financial instruments for hedge of net investment in foreign operations (Effective portion of fair value differences) VII. The effect of corrections of errors and changes in accounting policies - - VIII. Other profit loss items accounted under equity due to TAS - - IX. Deferred tax of valuation differences - - X. Total Net Profit/Loss accounted under equity (I+II+ +IX) XI. Profit/Loss Change in fair value of marketable securities (Transfer to Profit/Loss) Reclassification and transfer of derivatives accounted for cash flow hedge purposes to Income Statement Transfer of hedge of net investments in foreign operations to Income Statement Other - - XII. Total Profit/Loss accounted for the period (X±XI) The accompanying notes are an integral part of these financial statements. 8

15 STATEMENT OF CHANGES IN SHAREHOLDER'S EQUITY THOUSAND TURKISH LIRA Effect of inflation Share Note Accounting on Certificate Current Period Prior Period Marketable STATEMENT OF CHANGES OF SHAREHOLDER'S EQUITY Paid-in Capital Capital and Other Capital Reserves Share Premium Cancellation Profits Legal Reserves Statutory Reserves Extraordinary Reserve Other Reserve Net Income / (Loss) Net Income / (Loss) Securities Revaluation Reserve Total Equity Before Minority Shares Minority Shares Total Equity PRIOR PERIOD Reviewed (01/01-31/03/2008) I. Prior Period Balance 300, ,000-14, , , ,856 II. Corrections according to TAS The effect of corrections of errrors The effects of changes in accounting policy III. New Balance (I+II) 300, ,000-14, , , ,856 Changes in period IV. Increase/Decrease related to merger V. Marketable securities revaluation differences VI. Hedging Funds (Effective Portion) Cash-flow hedge Hedge of net investment in foreign operations VII. Tangible assets revaluation differences VIII. Intangible assets revaluation differences IX. Bonus shares obtained from associates, subsidiaries and jointly controlled entities (Joint vent.) X. Foreign exchange differences XI. The disposal of assets XII. The reclassification of assets XIII. The effect of change in associate s equity XIV. Capital increase Cash Internal sources XV. Share premium XVI. Share cancellation profits XVII. Inflation adjustment to paid-in capital XVIII. Other XIX. Period net income/(loss) , ,339 XX. Profit distribution (221,337) 221, Dividends distributed Transfers to reserves Other (221,337) 221, Closing Balance (I+II+III+IV+...+XIV+XV+XVI) 300, ,000-14, ,811-37, , ,195 CURRENT PERIOD Reviewed (01/01-31/03/2009) I. Prior Period Balance 900,000-3,307-25, ,020 4, , ,403,692 Changes in period II. Increase/Decrease related to merger III. Marketable securities revaluation differences IV. Hedging Funds (Effective Portion) Cash-flow hedge Hedge of net investment in foreign operations V. Tangible assets revaluation differences VI. Intangible assets revaluation differences VII. Bonus shares obtained from associates, subsidiaries and jointly controlled entities (Joint vent.) VIII. Foreign exchange differences IX. The disposal of assets X. The reclassification of assets XI. The effect of change in associate s equity XII. Capital increase Cash Internal sources XIII. Share premium XIV. Share cancellation profits XV. Inflation adjustment to paid-in capital XVI. Other XVII. Period net income/(loss) , ,655 XVIII. Profit distribution , ,204 - (246,529) Dividends distributed Transfers to reserves , , (246,529) Other (246,529) 246, Closing Balance (I+II+III+IV+...+XIV+XV+XVI) 900,000-3,307-37, ,224 4,275 52, ,456,785 The accompanying notes are an integral part of these financial statements. 9

16 STATEMENT OF CASH FLOWS THOUSAND TURKISH LIRA CURRENT PERIOD PRIOR PERIOD Reviewed Reviewed Note (01/01/ /03/2009) (01/01/ /03/2008) A. CASH FLOWS FROM BANKING OPERATIONS 1.1 Operating profit before changes in operating assets and liabilities (55,142) 25, Profit share income received 291, , Profit share expense paid (178,619) (108,814) Dividend received Fees and commissions received 78,679 61, Other income 12,700 35, Collections from previously written off loans 4,245 6, Payments to personnel and service suppliers (65,384) (50,307) Taxes paid (18,297) (2,507) Others (179,472) (162,792) 1.2 Changes in operating assets and liabilities 812,123 (87,847) Net (increase) decrease in financial assets Net (increase) decrease in financial assets at fair value through profit or los Net (increase) decrease in due from banks and other financial institution Net (increase) decrease in loans (198,288) (638,602) Net (increase) decrease in other assets 3,293 (838) Net increase (decrease) in bank deposits 11,902 3, Net increase (decrease) in other deposits 948, , Net increase (decrease) in funds borrowed 28,601 80, Net increase (decrease) in due payables Net increase (decrease) in other liabilities 17,839 45,755 I. Net cash provided from banking operations 756,981 (62,565) B. CASH FLOWS FROM INVESTING ACTIVITIES II. Net cash provided from investing activities (46,032) (8,471) 2.1 Cash paid for purchase of entities under common control, associates and subsidiarie Cash obtained from sale of entities under common control, associates and subsidiarie Fixed assets purchases (6,846) (9,244) 2.4 Fixed assets sales 10, Cash paid for purchase of financial assets available for sal (25,000) Cash obtained from sale of financial assets available for sal Cash paid for purchase of investment securities (25,000) Cash obtained from sale of investment securities Other - - C. CASH FLOWS FROM FINANCING ACTIVITIES III. Net cash provided from financing activities (6) (7,617) 3.1 Cash obtained from funds borrowed and securities issued Cash used for repayment of funds borrowed and securities issued Capital increase Dividends paid Payments for finance leases (6) (7,617) 3.6 Other - - IV. Effect of change in foreign exchange rate on cash and cash equivalents 407 4,796 V. Net increase in cash and cash equivalents 711,350 (73,857) VI. Cash and cash equivalents at the beginning of the year (1) 1,240,507 1,376,845 VII. Cash and cash equivalents at the end of the year (1) 1,951,857 1,302,988 The accompanying notes are an integral part of these financial statements 10

17 SECTION THREE ACCOUNTING PRINCIPLES I. Basis of Presentation: 1. Presentation of Financial Statements: The Bank prepares its financial statements and notes in accordance with the Communiqué on Banks Accounting Practice and Maintaining Documents, Turkish Accounting Standards ( TAS ), Turkish Financial Reporting Standards ( TFRS ), other communiqués, pronouncements and explanations about accounting and financial reporting issued by the Banking Regulation and Supervision Agency (BRSA), Turkish Commercial Code and the Tax Legislation. The prior period financial statements are presented in line with the principles of TAS No:1 Fundamentals of Preparing and Presenting Financial Statements published in the Official Gazette on January 16, 2005 with No:25702, and in accordance with Turkish Accounting Standards and Turkish Financial Reporting Standards; and other principles, methods and explanations about accounting and financial reporting issued by the BRSA. Certain reclassifications have been made to the prior year financial statements to comply with the current year presentation. In accordance with Law No: 5083 Monetary Unit of the Turkish Republic (Law No: 5083), the name of the Turkish Republic s monetary unit and its sub-currency unit is changed to the New Turkish Lira and the New Turkish Cent, respectively. However, in accordance with the additional resolution of the Council of Ministers in regards to the order on the removal of the phrase New in the New Turkish Lira and the New Turkish Cent and Its Application Principles, the phrase New used in Turkish Republic s monetary unit is removed both from New Turkish Lira and the New Turkish cent as of January 1, Basis of Accounting: The accompanying financial statements are based on the Bank s legal books. The Bank has recorded the adjustments of inflation accounting to its legal books beginning from June 30, 2004 to December 31, 2004 in accordance with Act No: 5024 of the Tax Procedural Code. As of December 31, 2003, the financial statements are prepared in accordance with the legal books and historical cost principle except for the revaluation of fixed assets and includes adjustments and reclassifications, including restatement for the changes in the general purchasing power of the Turkish Lira in accordance with International Accounting Standard No: 29 Financial Reporting in Hyperinflationary Economies ( TAS 29 ) prior to December 31, 2004 for the purpose of fair presentation. II. Usage Strategy of Financial Assets and Foreign Currency Transactions: The Bank manages its financial instrument strategies depending on the financing sources. The sources mainly constitute of the current and profit sharing accounts. As of the balance sheet date, the Bank s assets and equity structure are sufficient to cover its liabilities. The Bank uses 28 % of the funds collected in liquid instruments. The Bank does not carry a significant foreign currency position risk due to the existing floating exchange rate regime. The investment decisions are made by taking into consideration of the maturity structure of the balance sheet items. The Bank determines specific limits for the balance sheet. The allocation of asset items are designated, and yield analysis are made based on this designation. 11

18 SECTION THREE ACCOUNTING PRINCIPLES II. Usage Strategy of Financial Assets and Foreign Currency Transactions : In the statutory books of the Bank, the transactions recorded in foreign currencies (all other currencies except Turkish Lira) are translated into the Turkish Lira at the exchange rates prevailing at the transaction dates. Monetary asset and liabilities denominated in foreign currencies are translated into the Turkish Lira at the year end exchange rates of the Bank. Foreign exchange gains or losses arising from the translation of monetary items and foreign currency denominated collections or disbursements are recognized in the income statement. III. Forward and Option Contracts and Derivative Instruments: In determination of fair value of forward and swap transactions, forward rates discounted to the balance sheet date by prevailing profit share rates are compared with discounted forward rates of the transactions date and arising foreign exchange differences are recognized in the income statement. Although some derivative transactions economically provide risk hedging; they are recognized as held for trading in accordance with Turkish Accounting Standard No:39 Financial Instruments: Recognition and Measurement ( TAS 39 ) because all the required criteria for the designation of hedging accounting item are not met. Such instruments, therefore, are associated with the related gain or loss in the income statement. IV. Profit Share Income and Expenses: Profit share income and expenses are recognized in the income statement on an accrual basis. Realized and unrealized interest accruals of the non-performing loans are reversed and interest income in connection with these loans is recorded as interest income only when they are collected. V. Fees and Commission Income and Expenses: Banking service revenues are recognized as income only when they are collected while only the current portion of the prepaid commission income obtained from loans is recorded as income based on the periodicity principle. VI. Financial Assets: Financial instruments comprise of financial assets, financial liabilities and derivative instruments. Financial assets and financial liabilities are recognized on the Bank s balance sheet when the Bank becomes a party to the contractual provisions of the instrument. Basically, financial assets form majority of the commercial activities and operations of the Bank. Financial instruments expose, change or reduce the liquidity and credit risks of the Bank s financial statements. Fair value is the amount for which an asset could be exchanged or a liability settled, between knowledgeable willing parties in an arms length transaction. Fair value is best evidenced by a market price, being the amount obtainable from the sale, or payable on the acquisition, of a financial instrument in an active market, if one exists. Estimated fair values of financial assets are determined by the Bank by using the information about the market and relevant valuation methods. However, interpretation of market information is necessary to determine fair value. Therefore, estimated fair values presented in this report may not be necessarily equivalent of the disposal values of such assets derived from current market conditions. Some carrying values of the financial instruments (which are same with their cost values) are assumed to be equal to their fair values because of their short term nature. 12

19 SECTION THREE ACCOUNTING PRINCIPLES VI. Financial Assets : The methods and assumptions used in determining the reasonable estimated values of all financial instruments are mentioned below. Cash, Banks, and Other Financial Institutions: Cash and cash equivalents comprise of cash on hand, demand deposits, and highly liquid short-term investments not bearing risk of significant value change, and that are readily convertible to a known amount of cash. The book value of these financial assets approximate to their fair value. Financial Assets at Fair Value Through Profit and Loss: Marketable securities at fair value through profit or loss are classified in two categories; i) marketable securities classified as trading securities: acquired or incurred principally for the purpose of selling or repurchasing it in the near term in order to benefit from short-term profit opportunities; ii) marketable securities classified as marketable securities at fair value through profit or loss at initial recognition. The Bank uses the above-mentioned classification when permitted, or for the purposes of providing a more appropriate presentation. In this group, trading securities are initially recognized at cost and measured at fair value on the financial statements. Fair value of debt securities traded in an active market is determined based on the quoted prices or current market prices. The difference between initial cost and fair value of financial assets at fair value through profit and loss is reflected to profit share income or diminution in value of marketable securities accounts. Profit share income from financial assets at fair value through profit and loss is reflected in profit share income. Investments held to maturity include securities with fixed or determinable payments and fixed maturity when there is an intention of holding till maturity and the relevant conditions for fulfillment of such intention, including the funding ability. This portfolio excludes loans and receivables. Subsequent to initial recognition, held to maturity investments are measured at amortized cost by using the effective interest rate less impairment losses, if any. The Bank has no financial assets acquired and classified as held to maturity investments that cannot be subject to such classification for two years because of the non-performance of tainting rules. The profit share income received from held to maturity investments is recorded as profit share income in the income statement. Marketable securities classified as available for sale are initially recognized at cost including the transaction costs. After initial recognition, available for sale securities are measured at fair value and unrealized gains/losses originating from the difference between the amortized cost and the fair value are recorded in Marketable Securities Value Increase Fund under equity. At the disposal of available for sale financial assets, value increase/decrease recorded in Marketable Securities Value Increase Fund under equity is transferred to the income statement. As of March 31, 2009, the Bank has TRY Thousand of derivative financial assets held for trading at fair value through profit or loss. As of March 31, 2009, the Bank has TRY Thousand of financial assets available for sale and TRY Thousand held to maturity investments. 13

20 SECTION THREE ACCOUNTING PRINCIPLES VI. Financial Assets : Loans and Receivables: Loans and receivables are recognized at amortized cost. Fees, transaction costs and other similar costs in connection with the guarantees of loans and receivables are not considered as part of the transaction cost and recognized in the income statement. Loans are transferred to the relevant accounts in cash amounts and income accruals are calculated by using the internal rate of return method and the related income is recorded in the profit share income item. Foreign currency and foreign currency indexed loans are evaluated and evaluation differences are accounted under Foreign Exchange Gains and/or Foreign Exchange Losses in the income statement. The classification and provisioning of doubtful loans/receivables are appropriately accounted for in accordance with the prevailing regulations, and specific provisions allocated are recognized in the income statement for the period. Collections made from such loans are recognized under the Non-performing loans (including receivables from the the doubtful receivables) account and Profit share income received from Uncollectible Loans and Other Receivables account. Released provisions are accounted as a cancellation of such provisions if realized in the current year, and the remaining amounts are recognized in the account of collections from the prior year expenses. In addition to specific loan loss provisions, within the framework of the regulation and principles referred to above; the Bank records a general loan loss provision for loans and other receivables. The Bank calculated the general loan provision at 0,5% for cash loans and other receivables, and 0,1% for non-cash loans until November 1, Subsequent to the change in the regulation on Determining the Nature of Loan and Other Receivable Provisions Allocated By Banks and Procedures and Principles of Allocating Provisions which was published in the Official Gazette No: on November 1, 2006; the Bank started to book general loan loss provision at 1% for cash loans and other receivables; and 0,2% for non-cash loans on the increase in the cash and non-cash loan portfolio as compared to their October 31, 2006 balances whereas allocating 0,5% general loan loss provision for cash loans and other receivables, and 0,1% for non-cash loans for the balances as of October 31, Together with the change in the same regulation made on February 6, 2008, the Bank started to book general loan loss provision at 2% for cash loans under watch-list and 0,4% for non-cash loans under watch-list. VII. Impairment of Financial Assets: At each balance sheet date, the Bank evaluates the carrying amounts of its financial asset or a group of financial assets to determine whether there is an objective indication that those assets have suffered an impairment loss. If any such indication exists, the Bank determines the related impairment. A financial asset or a financial asset group incurs impairment loss only if there is an objective indicator related to the occurrence (loss/damage event) of one or more than one event (or occurrence) subsequent to initial recognition of that asset; and such loss event causes an impairment loss as a result of the effect on the reliable estimate of the expected future cash flows of the related financial asset and asset group. Any amounts attributable to expected losses arising from any future events is not recognized under no circumstances. Companies that are required to prepare separate financial statements under the statutory requirements in accordance with TAS 27 Consolidated and Separate Financial Statements can represent their subsidiaries or associates either at cost or the requirements set out in IAS 39, Financial Instruments: Recognition and Measurement. In this case, the Bank prefers to use the first method and presents the subsidiaries, jointly controlled entities and associates at cost less impairment loss, if any. 14