The world s favorite Turkish bank

Transcription

1 The world s favorite Turkish bank Profile 1H2012

2 Turkey in Brief Turkey is the 18 th largest economy in the world and carries the potential of becoming a leading economy with its young and dynamic population (average age: 30). In 2010 and 2011, Turkey accounted as one of the fastest growing countries in the world; and in 2012, Turkish economy slows down in a rebalancing manner. While growth remains as the focus, Turkey manages sustainable fiscal discipline which resulted in a primary surplus of USD 10.8 billion in 1H2012 and a much lower public debt to GDP ratio of around 37.9% compared to large European as well as CEEMEA countries. Macro-Economic Indicators H2012 Real GDP Growth 6.9% 4.7% 0.7% -4.8% 9.2% 8.5% 3.2% 1 Current Account Deficit / GDP -6.1% -5.9% -5.7% -2.3% -6.4% -10.0% 9.3% 1 Current Account Deficit (USD bn) Net FDI (USD bn) EU Defined Net Debt Stock / GDP 46.5% 39.9% 40.0% 46.1% 42.4% 39,4% 37.9% % 5.75% Policy Rate (O/N) 1.5% 15.75% 15.0% 6.5% 6.5%* 12.5% 11.5% Inflation (CPI) 9.7% 8.4% 10.1% 6.5% 6.4% 10.4% 8.9% Source: CBRT, Turkstat and Turkish Treasury Note: Exchange rate used for conversion is based on Garanti's June 30, 2012 dated financials. *Effective May 2010, one-week repo rate replaced the O/N rate as the policy rate 1 As of March, As of May, Year Cumulative Shareholder Return in the Istanbul Stock Exchange (ISE)* 3,000 2,500 (USD) Garanti ISE Banks Index ISE 100 Index 2,000 1,500 1, / /2012 * Figures are based on daily USD/TL CBRT ask rate Garanti shares continuously outperformed the market 10 year return of USD 100 in ISE 100 Index; 6x ISE Banks Index; 8x vs. Garanti; 16x

3 Turkish Banking Sector in Brief Turkish banking sector is the second largest CEE banking system with an asset size of USD 653 billion 1. In Turkey, there are 48 banks; 31 are deposit taking (including 3 state-owned), 13 are investment and development and 4 are participation banks. Turkish banking sector is well-regulated, monitored and governed by two primary regulatory authorities; the Banking Regulation and Supervision Agency (BRSA) and the Central Bank of Republic of Turkey (CBRT). Total Assets (USD billion) CAGR: 19% Top 10 Private Banks: 63% * State Banks: 31% * H2012 Main strengths include; Well-capitalized and underleveraged... Sound solvency with CAR 1 of 15.5% Tier-1 Ratio 2 :14.9% compared to 13.5% in LATAM, 13.1% in CEEMEA and 12.4% in EU area Low leverage 2 : 7.5x compared to 8.1x in LATAM, 9.5X in CEMEEA and 13.4x in EU area Underpenetrated market with strong growth potential... Total Assets/GDP 3 : 86% compared to 356% in EU area Total Loans/GDP 3 : 48% compared to 118% in EU area Total Customer Deposits/GDP 3 : 51% compared to 114% in EU area Highly liquid... Deposits fund ~60% 1 of assets Loans/Deposits ratio: 98% 1 Solid asset quality... NPL ratio 2 : 2.6% compared to 2.8% in LATAM, 9.5% in CEEMEA and 8.0% in EU area No open position 1 BRSA monthly data for commercial banks only, as of June US$/TL: Represents average of countries'. IMF-FSI database 2011 year-end data is used, where available. 3 ECB, TUIK and BRSA for commercial banks only data is used * As of March 31, 2012 Top Private Banks by Asset Size (USD billion) Foreign ownership % İşbank Garanti Akbank YKB DenizBank Finansbank* TEB HSBC* ING* Şekerbank* % 9.9% 40.9% 99.8% 94.7% 67.9% 100% 100% 33.9% Source: Figures are based on BRSA consolidated data as of June 30, 2012 Note: Exchange rate used for currency conversion is based on Garanti s June 30, 2012 dated financials * As of March 30, 2012; since the banks' earnings announcement dates do not allign with the Profile 1H2012 publishing date

4 About Garanti In Brief Established in 1946, Garanti is Turkey s second largest private bank by total assets of USD 95.8 billion. Garanti s core banking activities include retail, corporate, commercial, Small/Medium Enterprise Banking ( SME ) and payment systems. Garanti operates as an integrated financial services company with a total of eight financial subsidiaries offering services in pension, leasing, factoring, securities and asset management along with its international subsidiaries in the Netherlands, Russia and Romania. Garanti provides a wide range of financial services to its more than 11 million customers through an extensive distribution network of 915 domestic branches; 7 foreign branches in Cyprus, Luxembourg and Malta; 4 international representative offices in Moscow, London, Düsseldorf and Shanghai; around 3,500 ATMs; an award-winning Call Center; state-of-the-art internet and mobile banking platforms built on cutting-edge technological infrastructure. Garanti is Turkey s most profitable company with a proven track record of sustainable banking income generation. Garanti represents the highest ratings assessed to a Turkish Bank. Note: Exchange rate used for currency conversion is based on Garanti s June 30, 2012 dated financials Shareholder Structure Garanti s majority owners are Doğuş Holding Co. and Banco Bilbao Vizcaya Argentaria SA (BBVA) operating under the principle of equal partnership. Others 50.76% Doğuş Group 24.23% BBVA 25.01% Garanti is listed on the Istanbul Stock Exchange (ISE) since 1990 under the ticker symbol GARAN and the London Stock Exchange Main Market (LSE). In 1993, the Bank became the first Turkish bank to offer its shares to international markets in the form of American/Global Depositary Receipts (ADR/GDR). These international DRs are currently traded on the International Order Book (IOB) which is the international market of London Stock Exchange (LSE). In 2012, Garanti is entitled to join the prestigious tier of the U.S. Over-the-Counter (OTC) market, OTCQX International Premier where select OTC companies with the highest financial standards and superior information availability are traded. Garanti is the most valuable company in the ISE by USD 16.4 billion market capitalization as of June 30, Garanti also represents the highest floating market capitalization in the ISE. Our Strategy To sustain long-term growth via continuous value creation. Key Strengths Robust balance sheet and high capital adequacy ratios, Strong liquidity ratios and proven access to funding, particularly deposits, Strong brand reputation as a product and service innovator, Customer-centric approach with greater cross-sell ratios through sophisticated customer segmentation models and advanced technology, Competent and dynamic employee base led by a management team with proven track record, Sustainable growth in lending while keeping sound asset quality attributable to advanced risk management systems and disciplined credit approval process, Conservative provisioning policy and sophisticated collection procedures, State-of-the-art, proprietary IT platform with high operating efficiency and well-integration with the subsidiaries, Broad geographic coverage through extensive branch network and leadership in Alternative Delivery Channels.

5 Key Performance Indicators Total Assets Total Performing Loans Total Deposits Net Income USD 95.8 billion USD 53.4 billion USD 54.5 billion USD 1.0 billion Return on Average Equity (ROAE) 18.9% Return on Average Asset (ROAA) 2.1% Cost/Income (C/I) 45.6% Non Performing Loans Ratio (NPL) 2.1% Capital Adequacy Ratio (CAR) 15.3% Figures are based on BRSA consolidated financials as of June 30, 2012 Note: Exchange rate used for currency conversion is based on Garanti s June 30, 2012 dated financials Ratings (Moody's/S&P/Fitch) Ba2/BB/BBB- Total Branches 926 Personnel 17,249 ATM 3,388 POS* 498,264 Total Customers 11,178,715 Internet Customers** 2,200,825 Mobile Banking Customers** 245,351 Credit Cards 9,052,311 Debit Cards 6,706,847 *Includes shared POS **Active customers only-- min. 1 login per quarter Market Position Category Market Shares Ranking 1 Total Assets Total Performing Loans TL Loans FC Loans 13.1% 13.1% 11.2% 18.4% Assets #4 in 2000 in 1H2012 Total Retail Loans 2 C.C. Issuing C.C.Acquiring Mortgage Customer Deposits Customer Demand Deposits 12.8% 18.1% 18.8% 13.5% 12.3% 14.3% Loans #5 in 2000 Deposits #5 in 2000 in 1H2012 in 1H2012 Mobile Banking 36.6% Check Collections 10.7% Bancassurance-- Non-Life Insurance Bancassurance-- Life Insurance 15.6% 12.2% Note: Based on BRSA unconsolidated financials as of June 30, 2012 for fair comparision with the sector 1 Rankings are among private banks, as of June 30, Including credit card balances

6 Financial Subsidiaries The Netherlands based global boutique bank also serving customers in Germany, Switzerland and Ukraine 20+ years of presence in the country Specialized in trade finance, structured finance and private banking Assets: USD 5.8 billion 16 years of presence in the country Focus on corporate and commercial banking services Established relationships with large-scale highly credible Russian companies Sustainable profitability with sound asset quality Assets: USD 436 million 14 years of presence in the country First consumer banking project outside of Turkey 78 branches, >244k customers, >240k plastic cards Specialized in retail, SME and corporate banking Bonus Card, Romania s first international chip-based credit card with a reward program Assets: USD 2.0 billion Turkey s first asset management company Strong position in the sector with 15% market share Manages Garanti branded mutual funds, pension funds, discretionary portfolio management and alternative investment management services Assets Under Management: USD 4.3 billion #3 in ISE trading volume with 6.4% market share Leading brokerage house, a major player in M&A, public offerings, privatizations as well as settlement and custody services In 1H2012, equity model portfolio outperformed the ISE 100 Index by 6.1% Corporate Finance Transactions: USD 2.8 billion in number of pension participants with 20% market share #3 in pension fund size with 17% market share in number of life insurance policies 1 #3 in life insurance premium production 1 in unemployment insurance 2 Effective use of bancassurance via Garanti s extensive distribution network Total Funds: USD 1.6 billion in number of contracts with 15% market share. Presence in operational leasing sector with Garanti Fleet since 2007 Finance Lease Receivables: USD 1.4 billion in factoring volume with 10.1% market share 20+ years of presence in the sector 34.82% of shares are traded in the ISE Publicly traded with the ticker GARFA Factoring Volume: USD 1.9 million 1 As of May 31, As of December 31, 2011

7 Sustainability Garanti undertakes a systematic approach to sustainability that incorporates social, economic and environmental aspects. Coordinated by the Sustainability Committee, established in 2010, the Bank combines the sustainability related corporate memory and efforts towards developing a loan assessment process. Milestones Garanti; In 2009; calculated its greenhouse gas emissions ( carbon footprint ) and entered into the reporting cycle of Carbon Disclosure Project (CDP) with a reduction target for 2012 yearend. In 2010; published its first Sustainability Review. In 2011; became signatory for Investor CDP. In 2011; became the first finance sector member of the Turkish Business Council for Sustainable Development (TBCSD). In 2011; became a member of UN Environment Programme Finance Initiative (UNEP FI) and in 2012; signed the UN Global Principles Agreement in membership of UN Global Compact. In 2012; established a full-time Sustainability Team, whose sole responsibility is to coordinate the sustainability activities of the Bank. In 2012; started to build an Environmental Management System which will be applied to all facilities of the Bank. Corporate Governance Garanti pays optimum attention to the application of the best corporate governance practices and by implementing effective and balanced policies, the Bank fosters its successful performance. In compliance with the corporate governance best practices, Garanti s Board of Directors has established the following committees; Credit Committee, Assets & Liabilities Committee, Audit Committee, Anti-Fraud Committee, Liquidity Risk Management Committee. Corporate Social Responsibility Garanti is committed to create value for the society. To enhance and sustain the society s quality of life, the Bank extends long-lived support to projects in education, culture, arts, sports and environment that represent the corporate culture and broaden the vision of individuals and the community. Select Awards Garanti is recognized as the Best Bank in Turkey for the 11 th time at Euromoney Awards for Excellence. Garanti is honored as the Best Bank in Turkey award among the Best Emerging Market Banks in CEE survey conducted by Global Finance. Garanti received 5 different awards at the Euromoney Real Estate Awards including Banking/Overall, Loan Finance, Equity Finance, Debt Capital Markets, and M&A Advisory. Garanti, with its USD 700 million financing in Unit Gebze CCGT deal, got recognized with Euromoney European Power Deal of the Year and Turkish Deal of the Year awards by Private Finance Initiative as well as Power Deal of the Year Award by Infrastructure Journal Awards. Garanti Online was awarded The Best Bill Payment & Presentment in CEE by Global Finance. Garanti s efforts in communicating its sustainable financial performance in its annual report along with its commitment for sustainability as a whole is recognized as the Best Sustainability Communications Program by the League of American Communications Professionals (LACP). Garanti received the ASTD 2011 BEST award from American Society for Training & Development s (ASTD). The ASTD recognize organizations that demonstrate enterprise-wide success through employee learning and development. Run by the employees with the aim of supporting preschool education, Garanti s CSR Program Elim Sende project is recognized as The Most Successful Responsibility Project by Private Sector Volunteers Foundation. As the first company in Turkey to receive certification from Investors in People (IIP), Garanti was able to step up from its silver status recognition in 2009 to gold in 2012 which only 615 out of 24,000 IIP certified companies around the world hold. The award signifies Garanti s differentiating human-centered management, highly-qualified team and efficiency-oriented HR practices. For the full list of awards and recognitions, please refer to

8 For further information please contact Garanti Investor Relations. Address: Levent, Nispetiye Mah. Aytar Cad. No: 2, 34340, Beşiktaş, Istanbul-Turkey Tel: +90 (212) Fax: +90 (212) Web: Garanti_IR Disclaimer: This report has been prepared by Garanti Bank Investor Relations Department and is provided for information purpose only. Although the information on which the report is based has been obtained from sources which we believe to be reliable, no representation or warranty is made by Garanti Bank for the accuracy or completeness of the information contained herein. Information contained herein is subject to change without notice. Garanti Bank and/or any person connected with it accepts no liability whatsoever for any direct or consequential loss of any kind arising out of the use of this document or any part of its contents.