1 INVESTOR PRESENTATION 30 SEPTEMBER 2018
Leasing Sector in Turkey
Leasing Leasing advantages 3 VAT is %1 for various types of machinery Expertise on SMEs, consultancy and know-how support in addition to funding FX borrowing option (for selective assets) Fast credit approvals (leased-asset ownership), flexible payment plans Sale-and-lease back and operating leases were added to finance leases in 2013 by a regulation change.
Leasing Sector Leasing Volume 4 Milyon USD 9,3% -16,7% 30,4% 6.990 7.637-3,7% 1,0% 9,6% 14% 28% 6.365 6.130 6.194 4.891 5.360 24% 24% 18% 4.500 3.937 17% 2011 2012 2013 2014 2015 2016 2017 2018/09 2018 T Leasing Sat Geri Kirala
Leasing Sector Turkey Leasing Penetration 5 Leasing penetration is still at low levels compared to EU average of 15% and North America average of 21,5%. 12% 10% 8% 6% 4% 2% 2005 2007 2009 2011 2013 2015 2017 0% Penetration: Leasing volume/ Private sector fixed investments
Leasing Sector Leasing Receivables 6 14.000 12.000 TL % FX % 9.530 10.895 12.699 12.632 12.509 1.438 120,00% 100,00% 10.000 23% 26% 28% 28% 25% 20% 80,00% 8.000 60,00% 6.000 4.000 40,00% 2.000 20,00% 0 2012 2013 2014 2015 2016 2018 Q3 0,00%
Leasing Sector Customer Base 7 59.000 58.000 10,02% 10,65% 11,17% 12% 57.000 56.000 55.000 9,04% 10% 8% 54.000 53.000 52.000 51.000 50.000 49.000 48.000 8,19% 2014 2015 2016 2017 2018/Q3 Sector Total İş Leasing Share 6% 4% 2% 0%
Company Overview
History Milestones & Shareholders 1985 Leasing Law Enacted 1995 İş Bank group took over 2011 First corporate bond issuer in leasing sector 9 1988 Established by İş Bank, Soc Gen and IFC 2000 Listed in İstanbul Stock Exchange (ISFIN)) OTHERS 40,11% İŞ BANK 30,43% TSKB 29,46%
Company ORGANIZATION CHART 10
Company BRANCH NETWORK 11 Avcılar Şişli Kozyatağı Kartal Ostim Trabzon Bursa Ankara Kayseri İzmir Diyarbakır Konya Antalya Adana Gaziantep 15 Branches 51 Sales staff 153 Total staff
Lease Portfolio
Lease portfolio SALES CHANNELS 13 2017 İŞ BANK DIRECT MARKETING VENDORS 2018/Q3 İŞ BANK DIRECT MARKETING VENDORS 16% 14% 20% 64% İşbank: 1342 local and 22 foreign branches, largest network among private banks. 22% 64%
Lease portfolio SECTORAL DISTRIBUTION, % 14 2017 2018 Q3 33,01 34,88 24,42 26,35 12,75 11,53 10,09 10,94 7,33 6,50 4,83 4,30 2,86 4,40 3,27 2,54 CONSTRUCT METAL IND. TEXTILE TRANSPORT RETAIL CHEMICALS FINANCE OTHER
Lease portfolio ASSET DISTRIBUTION, % 15 2017 2018 Q3 34,04 31,02 31,70 29,60 37,73 40,06 19,88 20,06 4,03 4,94 4,32 3,92 REAL ESTATE MACHINERY CONSTRUCTION MACH. TEXTILE TRANSPORTATION OTHER
Lease portfolio GEOGRAPHICAL DISTRIBUTION, % 16 ANKARA 16,25% GAZİANTEP 4,42% İSTANBUL 46,50% BURSA 3,25% İZMİR 4,91% KONYA 2,66% OTHER 20,30% ANTALYA 1,70%
Leasing - Borrowing MATURITY DISTRIBUTION, % 17 2017 2018 Q3 LEASİNG BORROWINGS 23,83 23,14 LEASİNG BORROWINGS 18,24 18,49 17,86 19,96 15,98 8,03 9,24 11,05 11,05 6,68 USD EUR TRY USD EUR TL average, months *TL funded by equity is included in the calculation.
Lease portfolio CURRENCY DISTRIBUTION, % 18 TL 36% USD 32% TL 36% USD 24% TL 39% USD 23% EUR 33% EUR 39% EUR 38% 2016 2017 2018/Q3
Borrowing LEVERAGE 19 Leverage(solo) TRY Receivables Equity TL Debt TL Portfolio 5,0 5,1 5,1 3,1 3,9 4,3 932 1.166 1.477 1.760 1.720 306 474 722 920 873 626 692 755 840 847 2013 2014 2015 2016 2017 2018/Q3 2014 2015 2016 2017 2018/Q3 Increased leverage by gaining market share
Borrowing FUNDING POLICY 20 Strong relations with international and local banks. o Closed a club loan transaction of 80 million US$ in 2018. o Bilateral loans (all unsecured) First TL corporate bond issuer in leasing sector, outstanding nominal balance 1.4 billion TL, maturities range between 3 months to 18 months. IFI and ECA Funding o IFC renewable energy and energy efficiency facility, World Bank EFIL- SME loans, CEB SME loans, BSTDB SME loan, ECO-Trade Bank, o Eximbank loans to support exporters Islamic Debt Markets o Closed two Murabaha facilities Strategy aiming diversification of creditors and debt products, maturity mismatch within manageable limits
Financial Performance
Financial Perfomance FINANCIAL HIGHLIGHTS 22 TL Million, consolidated 2015 2016 2017 2018 Q3 Δ Leasing Receivables, Net 3.287 4.001 4.701 6.580 40,0% Factoring Receivables, Net 1.951 2.986 4.207 2.158-48,7% Non Performing Receivables 183 231 266 319 19,7% Provisions 140 150 180 202 11,8% Total Assets 5.581 7.480 9.283 9.164-1,3% Financial Liabilities 4.661 6.394 8.038 7.447-7,4% Equity 738 830 975 1.070 9,8% Net Interest Income 121 146 82 97 17,9% Provisions Expenses -48-23 -33-24 -26,7% Consolidated net Profit 82 104 113 95-15,9% RATIOS NPL / Receivables 3,4% 3,2% 2,9% 3,6% Provision Ratio 76,3% 65,1% 67,7% 63,2% Cost / Income 37,0% 37,7% 66,3% 48,5% ROE 12,2% 13,2% 12,5% 12,4% ROA 1,8% 2,1% 1,3% 1,4%
Financial Perfomance SOLO KEY FIGURES 23 (Million TL) 2015 2016 2017 2018/Q3 Δ 2015 2016 2017 2018/Q3 Δ Financial Highlights Leasing Receivables 3.249 3.921 İş 4.617 6.476 40% 36.728 44.022 Sector 51.990 71.886 38% Total Assets 3.656 4.508 5.069 7.013 38% 40.655 48.500 58.053 79.280 37% Equity 692 755 840 847 1% 6.930 7.800 8.567 9.484 11% Net Profit 81 82 74 24-68% 809 922 940 936 0% NPL Ratio 4,3% 4,7% 4,6% 3,9% 6,0% 6,3% 5,5% 5,1% Debt/Equity 4,0 4,7 5,0 7,3 4,5 4,8 5,8 7,4 ROE * 10,3% 11,7% 10,0% 4,6% 13,1% 13,0% 11,5% 10,8% ROA 2,4% 2,0% 1,5% 0,5% 2,1% 2,1% 1,8% 1,7% *: Bonus shares from İş Factoring (19 million TL) in 2015 have been off-set
Financial Perfomance NPL 24 7,99% 300.000,000 7,00% 6,95% 6,70% 6,03% 6,26% 5,55% 5,08% 250.000,000 200.000,000 151-240 4,80% 4,60% 4,31% 4,65% 4,63% 3,87% 150.000,000 100.000,000 241-360 >360 Total 50.000,000 2012 2013 2014 2015 2016 2017 2018/Q3 Sector İş Leasing(solo) 0,000 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Consolidated 31.12.2015 31.12.2016 31.12.2017 30.09.2018 Gross NPL /Total Receivables Net NPL / Net Receivables 3,40% 3,23% 2,93% 3,57% 0,83% 1,15% 0,97% 1,34% 000 TL LOSS RESERVE 2017 Opening (180.256) Reversals 3.026 New provisions (24.290) 30.09.2018 Closing (201.520)
Financial Perfomance COLLATERALS 25 Leased assets are legally possessed by the lessor so they are the collateral of the leasing loan. Depending on the lessee s credit ratings and second hand value of the leased asset, additional collaterals might be demanded. Cash + LG + Pledge + Buyback 4,63% Mortgage 4,11% Prom. Note+ Personal Guarantee 91,26% *Group leasing transactions excluded
Financial Perfomance RATING 26 Corporate Governance Rating (Saha-2016) : 9.17
DISCLAIMER 27 The information in this document has been obtained by İş Finansal Kiralama A.Ş. ( İş Leasing ) from sources believed to be reliable, however, İş Leasing can not guarantee the accuracy, completeness, or correctness of such information. This document has been issued for information purposes only. The financial reports and statements announced by İş Leasing to the public and the relevant corporations are accepted to be the sole material. İş Leasing does not accept any liability whatsoever for any direct or consequential loss arising from any use of this document or its contents due to the misleading information in this document. All estimations, if any, contained in this document are the opinions of İş Leasing and can be subject to change without notice. This document can not be interpreted as an advice to the investors and İş Leasing can not be held responsible for the results of the investment decisions made on the account of this document.