Turkiye Halk Bankasi Anonim Sirketi · BIST:HALKB

Turkiye Halk Bankasi Anonim Sirketi — Türkiye Halk Bankası A.S. — Q3 2016 Earnings Presentation

26 slides from Turkiye Halk Bankasi Anonim Sirketi's earnings presentation, 2016

  1. Slide 1: Q3 2016 Earnings Presentation

    Q3 2016 Earnings Presentation DISTINGUIS H ED PROFIT A BLE RESI L IENT RIS K CONSCIOUS RELIA B LE SUST A INABLE NATIO N WIDE MAR K ETMAKER BRSA Bank Only

  2. Slide 2: Macro Outlook

    Q3 2016 Earnings Presentation Macro Outlook > FED has taken a pass on Sep-16 rate hike, waiting for further > CBRT kept O/N lending rate unchanged at 8.25% in Oct-16. Cumulative evidence of economic progress towards its objectives. The rate cut since Mar-16 stands at 225 bps. economy added 156k new

  3. Slide 3: Banking Sector Overview

    Q3 2016 Earnings Presentation Banking Sector Overview > Total loan book increased 2.6% QoQ reaching TRY 1,626 bn. TRY > Trading income line continued to take toll on the bottom line. loans showed 1.2% increase, growing less than FX loans which > OpEx growth slowed down further, 4.2% YoY as of Aug-16

  4. Slide 4: September 2016 Highlights

    Q3 2016 Earnings Presentation September 2016 Highlights > Total net income has reached TRY 2,195 mn as of Sep-16, up by > Comfortable liquidity position maintained, L/D ratio at 105.1%. 31.7% from the previous year. > Low cost CBRT repo continued to be effectively used, volume at > YtD RoE at 14.4%

  5. Slide 5: Total net income up 31.7% YoY, supported by strong NII

    Q3 2016 Earnings Presentation Total net income up 31.7% YoY, supported by strong NII Net Income (TRY million) 43.8% 58.4% -28.9% 21.4% 31.7% 2,640 1,075 2,195 445 886 Additional Additional 680 445 Provisions 1,667 Provisions 648 630 438 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Q3-16 Sep-15 Sep-16 Sep-16 Adj. A

  6. Slide 6: Robust asset growth, rising 5.5% QoQ

    Q3 2016 Earnings Presentation Robust asset growth, rising 5.5% QoQ Asset Growth IEA Securities YtD 12.6% QoQ 5.5% 82.4% Portion 14.6% Total Asset Growth (TRY billion) Composition of IEAs(a) Asset Mix (%) 11.4% Loans Cash & CBRT 12.6% 5.5% 83.0% 82.9% 82.5% 82.9% 82.4% Securities Other Assets 211.3 2

  7. Slide 7: Growing securities portfolio accompanied by high yields of CPI linkers

    Q3 2016 Earnings Presentation Growing securities portfolio accompanied by high yields of CPI linkers Total Securities Portfolio (TRY billion) Interest Structure (%) Total Securities / Total Assets (%) 14.7 14.9 14.6 14.2 14.6 CPI-Linked (TRY 9.1 bn) 29.5% 27.9 27.9 28.5 28.4 30.9 FX 5.7 20% 5.8 21%

  8. Slide 8: Solid loan growth of 3.9% QoQ, in line with the budget

    Q3 2016 Earnings Presentation Solid loan growth of 3.9% QoQ, bringing cumulative growth in line with the budget (TRY billion)(a) 14.3% 14.0% Total Loans 3.9% HALKBANK B. Sector(b) YtD YtD 141.5 14.0% 8.4% 130.0 136.2 0.4 Commercial Loans QoQ QoQ 124.2 0.4 11.9 YtD 16.7% 3.9% 2.6% 123.8 0.3 QoQ 4.5%

  9. Slide 9: Well-balanced loan portfolio with efficient segmentation

    Q3 2016 Earnings Presentation Well-balanced loan portfolio with efficient segmentation Loans by Currency (%)(a) Loans by Customer Segmentation (%)(a) SME 5.0% Commercial 3.3% Commercial 9% Corporate 24.5% SME 39% FX Corporate 31% TRY 32.8% 67.2% Cooperative 14%(b) Retail 21% Sectoral Breakdown of Lo

  10. Slide 10: Retail loan growth supported by secured mortgage loans

    Q3 2016 Earnings Presentation Retail loan growth supported by secured mortgage loans (TRY billion)(a) 9.7% HALKBANK 9.2% YtD 3.6% 9.2% 30.1 QoQ 29.1 28.2 3.6% 27.5 27.6 Consumer Loans 12.8 YtD 5.6% 12.7 QoQ 0.8% B. Sector(b) 12.3 12.1 12.2 Share in total 42.5% YtD 5.1% Housing Loans QoQ 12.0 12.2 12

  11. Slide 11: Restrained NPL ratio below sector average, no write-off/no sell-off

    Q3 2016 Earnings Presentation Restrained NPL ratio below sector average, no write-off/no sell-off NPL Portfolio (TRY million) NPL Coverage (%) 4,625 4,330 76.1 76.2 4,137 75.8 76.0 75.1 3,871 3,974 Sep-15 2015 Mar-16 Jun-16 Sep-16 Sep-15 2015 Mar-16 Jun-16 Sep-16 Loans under Close Watch (TRY million

  12. Slide 12: NPL ratio by segments

    Q3 2016 Earnings Presentation NPL ratio by segments Halkbank NPL Sector NPL (a)(c) Corporate - Commercial (%) (a) Consumer Loans (%) (a) 6.2 5.9 5.9 5.6 3.7 3.8 3.7 3.7 3.7 5.3 2.5 2.5 2.5 2.5 2.2 2.2 2.3 1.8 2.0 2.0 1.8 1.9(b) 1.6 1.7 1.5 Sep-15 2015 Mar-16 Jun-16 Sep-16 Sep-15 2015 Mar-16 Jun-16 S

  13. Slide 13: CoR completely in line with the budget, 59 bps YtD

    Q3 2016 Earnings Presentation CoR completely in line with the budget, 59 bps YtD Cost of Risk (bps)(a) Cost of Risk by Segments (bps)(a) YtD Quarterly 148 84 76 73 63 60 61 59 54 38 40 58 59 54 18 Sep-15 2015 Mar-16 Jun-16 Sep-16 SME Retail Commercial Corporate Total Net Cost of Risk Gross Cost of R

  14. Slide 14: LDR down to 105%, diverging from sector average

    Q3 2016 Earnings Presentation LDR down to 105%, diverging from sector average IBL 85.0%(a) Loan to Deposit (%) Composition of IBLs(a) Liabilities Mix (%) (b) Halkbank L/D Sector L/D Deposits Marketable 86.0% 85.2% 85.2% 84.8% 85.0% Funds Borrowed Securities Issued Interbank Money Market Shareholders

  15. Slide 15: Deposit base further strengthened, growing 5.5% QoQ

    Q3 2016 Earnings Presentation Deposit base further strenghtened, growing 5.5% QoQ HALKBANK B. Sector(b) YtD 11.1% -1.5% HALKBANK B. Sector(b) HALKBANK B. Sector(b) QoQ 2.5% -3.6% in USD YtD 8.2% -4.2% YtD 12.6% 7.4% YtD 13.5% 14.5% terms QoQ -1.2% -7.0% QoQ 5.5% 2.3% QoQ 7.1% 6.7% Total Deposits TRY

  16. Slide 16: Remarkable decline in the Cost of TRY deposits, 50 bps QoQ

    Q3 2016 Earnings Presentation Remarkable decline in the Cost of TRY deposits, 50 bps QoQ Demand Deposits (TRY billion)(a) Time Deposits (TRY billion)(a) Deposits by Currency (%) Demand Deposits/Total Deposits (%) Time Deposits/Total Deposits (%) 17.1% 83.8% 83.8% 83.7% 82.9% 83.8% 16.2% 16.2% 16.3%

  17. Slide 17: Cost - Yield - Spread

    Q3 2016 Earnings Presentation Cost - Yield - Spread(a) Cost of Deposits (%) Spreads (%) On Loans On Securities 6.4 6.2 6.0 5.9 5.5 4.4 4.6 4.0 4.3 3.8 3.1 3.7 1.2 3.4 1.2 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Yield on Loans (%)(b) Yield on Securities (%) 10.0 10.0 10.2 10.5 10.

  18. Slide 18: Quarterly NIM expanded ~50 bps, enjoying core spread improvement

    Q3 2016 Earnings Presentation Quarterly NIM expanded ~50 bps, enjoying core spread improvement and CPI linkers’ support. Net Interest Income (TRY million) Breakdown of Interest Income (%) Interest Income Interest Expenses 36.5% 19.1% 15% 19.7% on Securities 4,181 4,979 1,881 1% on Others 1,378 1,481

  19. Slide 19: Growth in Net fees & commissions pick up towards targeted levels

    Q3 2016 Earnings Presentation Growth in Net fees & commissions pick up towards targeted levels Net Fees & Commissions Income (TRY million) 27.0% 8.4% 6.1% 886 961 344 324 308 292 271 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Sep-15 Sep-16 Breakdown of Fees & Commissions (%) Net Fees & Commissions / Operating Re

  20. Slide 20: Opex growth cut pace further as rebates fare below expectations

    Q3 2016 Earnings Presentation Opex growth cut pace further as rebates fare below expectations Operating Expenses (TRY million) Operating Expenses / Average Assets (%) 1.5% 8.4% -2.4% 2,801 2,584 962 931 80 (a) 2.0 2.0 1.9 904 909 174 895 38 27 15 (a) 57 41 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Sep-15 Sep-16

  21. Slide 21: Solvency Ratios

    Q3 2016 Earnings Presentation Solvency Ratios CAR (%) Details on Capital Ratio Tier-I CAR Basel III (TRY mn) Sep-16 Credit Risk Base Amount (CRBA) 151,507 13.8 13.7 13.5 13.5 13.0 Market Risk Base Amount (MRBA) 5,710 13.1 13.0 12.8 12.6 Operational Risk Base Amount (ORBA) 11,297 12.2 Total Risk Weig

  22. Slide 22: Branch Network – Human Resources

    Q3 2016 Earnings Presentation Branch Network – Human Resources > 12 new branches opened until Sep-16. > Total branch number reached 956. Loans and Deposits per Branches (%) Breakdown of Banking Transactions (%) Automatic Loans/Branches Deposits/Branches Internet 151.3 Banking 12% Payment 5% 145.3 13

  23. Slide 23: Balance Sheet

    Q3 2016 Earnings Presentation Balance Sheet QoQ YtD YoY In TRY million Sep-15 2015 Jun-16 Sep-16 Change% Change% Change% Cash and Balances Held with the Central Bank(a) 23,506 23,325 24,236 27,038 11.6 15.9 15.0 Banks & Money Market(b) 4,591 2,513 852 810 (5.0) (67.8) (82.4) Securities(b) 27,900 27,

  24. Slide 24: Income Statement

    Q3 2016 Earnings Presentation Income Statement QoQ YoY Change Change In TRY million Sep-15 Sep-16 YoY % Q3-15 Q2-16 Q3-16 % % Interest Income 9,865 12,307 24.8 3,466 4,021 4,341 8.0 25.2 On Loans 8,166 10,319 26.4 2,976 3,461 3,640 5.2 22.3 On Securities 1,665 1,876 12.7 473 523 664 26.9 40.4 Intere

  25. Slide 25: Notes

    H1 2016 Earnings Presentation Notes Financial Institutions and Investor Relations 24 www.halkbank.com.tr

  26. Slide 26: For further information please contact

    For further information please contact halkbank.IR@halkbank.com.tr DISCLAIMER The information contained in this presentation has been prepared by Türkiye Halk Bankası A.S. (the Bank) for informational purposes only. Although the information in this presentation has been obtained from sources which t

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