Turkiye Vakiflar Bankasi Turk Anonim Ortakligi · BIST:VAKBN

Turkiye Vakiflar Bankasi Turk Anonim Ortakligi — Türkiye Vakıflar Bankası T.A.O. (VakıfBank) — H1 2023 Earnings Presentation

26 slides from Turkiye Vakiflar Bankasi Turk Anonim Ortakligi's earnings presentation, Aug 9, 2023

  1. Slide 1: Earnings Presentation BRSA Bank-Only 1H23

    Earnings Presentation BRSA Bank-Only 1H23 August 9, 2023

  2. Slide 2: 2Q23 Earnings and profitability

    Earnings Presentation Bank-Only 1H23 2Q23 Earnings and profitability Net Income (TL million) Pre-Provisioning Profit (TL million) * 5.4% 10,019 TL 6.7 billion free provisions 23,710 24,995 1,594 11,550 Trading 5,509 -17,625 Opex -6,848 4,502 4,119 9,234 F/C 23,716 8,215 NII 1,007 1,129 13,621 Other

  3. Slide 3: Key highlights of 2Q23

    Earnings Presentation Bank-Only 1H23 Key highlights of 2Q23 Eye-catching fee income growth on track 25.2% Quarterly fee income growth came at 25.2% 52%* Fee/opex ratio came at 52% in 1H23 124.2% Annual fee income growth came at 124.2% Strong quarterly trading income thanks to both FX exchange transa

  4. Slide 4: 2Q23 P&L details

    Earnings Presentation Bank-Only 1H23 2Q23 P&L details QoQ 2Q23 vs. 1H23 YoY Net Interest (73%) 1,762 Income 8,214 (65%) Net Fees and 25% 5,134 9,234 124% Commissions Dividend 1,228% 9 9 (94%) Income Free Provisions Net Trading 9,298 11,550 625% YE22 TL 19 billion 313% Income 1Q23 -TL 12 billion Othe

  5. Slide 5: NIM, CPI linkers and money market funding

    Earnings Presentation Bank-Only 1H23 NIM, CPI linkers and money market funding CPI Expectation NIM / Swap Adj. NIM (%) Adj. with exp. 3Q23 CPI linker income; 6.8 2.7% 2.8 5.0 1.0 Adj. with exp. 3Q23 CPI linker income; 6.5 2.6% 4.7 0.9 1.8 2021YE 1H22 2022YE 1H23 ~ ~ ~ ~2% ~2% Total Money Market Fund

  6. Slide 6: Eye-catching fee income growth on track

    Earnings Presentation Bank-Only 1H23 Eye-catching fee income growth on track Net Fee & Commission Income (TL million) Net Fee & Commission Income Breakdown Cash Loans Non-Cash Loans 124% vs 118% 9,234 YoY growth of sector avg 49% 13% Payment Systems Insurance 5,134 4,119 4,101 25% 28% 9% 1H22 1Q23 2

  7. Slide 7: Expected improvement in cost/income ratio to ~30% level

    Earnings Presentation Bank-Only 1H23 Expected improvement in cost/income ratio to ~30% level Opex (TL million)* Cost/Income Ratio (%)* 157% 17,932 17,625 37.2 31.5 30.0 19.8 7,996 18.1 6,848 1H22 YE22 1Q23 1H23 1H22 YE22 1Q23 1H23 2023 E HR Cost (TL million) Breakdown of Opex * Non-HR Cost (TL milli

  8. Slide 8: Selective TL loan growth in key segments

    Earnings Presentation Bank-Only 1Q23 Selective TL loan growth in key segments Portfolio Breakdown VB Sector VB Sector QoQ Loan Growth QoQ QoQ YoY YoY (%) (%) (%) (%) 2Q23 25% Com. & Corp 1Q23 11% Total Loan Growth 16.8 17.5 75.0 59.4 TL 715 billion 4Q22 14% 56% 3Q22 12% TL Loan Growth 11.5 11.6 90.3

  9. Slide 9: Breakdown of loan portfolio

    Earnings Presentation Bank-Only 1H23 Breakdown of loan portfolio Currency Breakdown Loans by Interest Structure 70% 30% TL FC 2Q23 TL Loans FC Loans ($) 80% 69% 24% 23% QoQ Growth 4% 31% 12% 12% 20% -5% 0% -4% 3Q22 4Q22 1Q23 2Q23 3Q22 4Q22 1Q23 2Q23 Fixed Rate Floating Rate Sectoral Breakdown of Cas

  10. Slide 10: Net CoR in line with guidance

    Earnings Presentation Bank-Only 1H23 Net CoR in line with guidance NPL (TL million)* Stage II Loans Breakdown (TL million) Stage II 18.3 24.4 23.7 22.1 Coverage 2,281 Ratio (%) 19,942 1,080 21,143 9.48 8.26 7.18 6.94 Share in total loans (%) 88,156 78,148 Total Stage II 77,124 Loans 68,785 NPL 1Q23

  11. Slide 11: Well-balanced deposit portfolio

    Earnings Presentation Bank-Only 1H23 Well-balanced deposit portfolio Total Deposits (TL billion) Breakdown of Deposits 78% 57% 59% 43% 41% 1,402.2 Sector 1,252.7 12% 1,127.7 573.2 TL Deposits FC Deposits 423.7 TL Deposits FC Deposits $ 22.0 Retail Deposit 447.0 $ 22.1 18% 787.7 FC $ 23.9 State Depos

  12. Slide 12: Fresh funding amounting USD 500 million with 5 years maturity

    Earnings Presentation Bank-Only 1H23 Fresh funding amounting USD 500 million with 5 years maturity Breakdown of International Funding TL 210 billion* sustainable finance provided as of 2Q23 in the balance sheet AT I Issuance IFI Repo Eurobond Borrowings 8.8% Transactions 23.8% 5% 6% Eurobond Sustain

  13. Slide 13: Solvency ratios

    Earnings Presentation Bank-Only 1H23 Solvency ratios Capital Adequacy Ratio (%) Required CET1 Solvency ratios CET I 11.36 11.69 11.52 12.58 11.33 level 8.5% Solvency ratios including free (%) without BRSA provision amount of forbearance Tier I 13.68 13.90 13.55 14.32 13.36 Required Tier I TL 6.7 bil

  14. Slide 14: Appendix

    Earnings Presentation Bank-Only 1H23 Appendix Pg. 15 Sustainable banking approach Pg. 16 Sustainable loan products Pg. 17 Firsts in sustainable banking Pg. 18 Sustainable customer base thanks to enhanced digital platforms Pg. 19 Composition of assets & liabilities Pg. 20 ~70% of TL security book is

  15. Slide 15: Sustainable banking approach

    Earnings Presentation Bank-Only 1H23 Sustainable banking approach Indices Initiatives Sustainability Rating ❑ Score: 48 in 2022 ❑ B Score in 2022 ❑ 1st assessment in 2015 ❑ B- Score in 2022 ❑ 1st assessment in 2022 Sustainability Reporting 15

  16. Slide 16: Sustainable loan products

    Earnings Presentation Bank-Only 1H23 Sustainable loan products Green Mortgage Loan Women in Business Loan ➢ Aiming to support the reduction of residential ➢ For a business that is managed or owned by energy consumption and greenhouse gas women, having less than 250 employees and emissions from the r

  17. Slide 17: Firsts in sustainable banking

    Earnings Presentation Bank-Only 1H23 Firsts in sustainable banking The first Turkish bank to have its targets Proactive provisioning policy in accordance with CBAM validated by (Carbon Border Adjustment Mechanism) and Science Based Targets initiative (SBTi) ‘Fit for 55’ principles Scope 1 & Scope 2

  18. Slide 18: Sustainable customer base thanks to enhanced digital platforms

    Earnings Presentation Bank-Only 1H23 Sustainable customer base thanks to enhanced digital platforms Branch 943 8% Branches # of active* digital Internet banking customers Banking reached ~7.3 mio ~7.3 million 48% Digital Banking Non-branch Customers # of transaction made Mobile transaction through d

  19. Slide 19: Composition of asset & liabilities

    Earnings Presentation Bank-Only 1H23 Composition of asset & liabilities Breakdown of Assets (%) Currency Breakdown of Total Assets The biggest listed bank 2Q23 Other in terms of asset size 17 with 11.5% market Interbank share among Turkish banks 3 38% 62% 2Q23 Loans The share of IEA 58 Securities 83

  20. Slide 20: ~70% of TL security book is floating

    Earnings Presentation Bank-Only 1H23 ~70% of TL security book is floating Total Securities (TL million) Portfolio Structure 55.8% 474,184 6% 5% 404,964 34% 17.1% 8.7% 53% 372,588 304,335 251,512 41% 61% 158,593 209,153 104,454 17,096 28,974 14,865 22,432 2Q23 2Q22 185,016 196,899 173,380 193,697 Tra

  21. Slide 21: Retail lending

    Earnings Presentation Bank-Only 1H23 Retail lending General Purpose Consumer (TL billion) Residential Mortgages (TL billion) Credit Card Loans (TL billion)* 32.8% 1.5% 181.8% 98.5 75.2 71.4 58.0 57.1 55.6 54.9 72.7 54.0 35.4% 59.4 56.4 56.6 56.1 5.3% 5.7% 42.3 35.0 2Q22 3Q22 4Q22 1Q23 2Q23 2Q22 3Q22

  22. Slide 22: Diversified funding sources via non-deposit funding

    Earnings Presentation Bank-Only 1H23 Diversified funding sources via non-deposit funding Syndication Eurobonds and Private Placements USD 1.4 billion outstanding USD 2.6 billion outstanding Eurobonds and USD 632.5 million outstanding ▪ May’23: USD 815 million equivalent syndicated loan, SOFR +4.25%,

  23. Slide 23: Unconsolidated Key Financial Ratios

    Earnings Presentation Bank-Only 1H23 Unconsolidated Key Financial Ratios 1H22 2022 1Q23 2Q23 1H23 Profitability ROAE 30.3% 30.2% 14.5% 2.9% 9.03% ROAA 1.8% 1.8% 1.0% 0.2% 0.6% Cost / Income 19.8% 18.1% 31.5%* 43.8% 37.2%* Cost / Assets 1.1% 1.1% 4.4% 1.8% 2.7% Fee / Cost 60.1% 60.2% 51.3%** 53.3%**

  24. Slide 24: Unconsolidated Balance Sheet

    Earnings Presentation Bank-Only 1H23 Unconsolidated Balance Sheet (TL-thousand, %) 2Q22 1Q23 2Q23 USD USD USD TL TL TL YoY QoQ equivalent equivalent equivalent Cash & Balances with Central 160,491,468 9,616,026 212,922,730 11,098,367 229,435,856 8,805,271 43.0% 7.8% Bank Assets Interbank 42,414,914

  25. Slide 25: Unconsolidated Income Statement

    Earnings Presentation Bank-Only 1H23 Unconsolidated Income Statement (TL thousand, %) 1H22 1Q23 2Q23 1H23 YoY QoQ Net Interest Income 22,178,486 5,941,206 1,312,944 7,254,150 (67.3%) (77.9%) (Inc. Swap Cost) Swap Cost -1,537,125 -511,322 -448,944 -960,266 (37.5%) (12.2%) Net Fee & Com. Income 4,118,

  26. Slide 26: For Earnings Presentations: Investor Relations

    For Earnings Presentations: A member of BIST Sustainability Index Investor Relations Finanskent Mahallesi Finans Caddesi No:40/1 Ümraniye / İstanbul E-mail: investorrelations@vakifbank.com.tr Tel (90-216) 724 2685 Fax (90-216) 724 3941 www.vakifbank.com.tr Disclaimer Notice: This report has been pre

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