Turkiye Is Bankasi Anonim Sirketi · BIST:ISBTR
Turkiye Is Bankasi Anonim Sirketi — Türkiye İş Bankası A.Ş. — H1 2009 Earnings Presentation
50 slides from Turkiye Is Bankasi Anonim Sirketi's earnings presentation, Jun 30, 2009
Slide 1: Isbank Investor Presentation 2009H1
ISBANK INVESTOR PRESENTATION 2009H1
Slide 2: Disclaimer
The information in this document has been obtained by Turkiye Is Bankasi A.S. (“Isbank”) from sources believed to be reliable, however, Isbank cannot guarantee the accuracy, completeness , or correctness of such information. This document has been issued for information purposes only. The financial
Slide 3: Agenda
Isbank at a Glance 5 Financial Highlights 9 Retail Banking 32 Customer Centric Transformation Program 38 Major Equity Participations 43 Page 3
Slide 4: Isbank at a Glance
Financial Highlights 9 Retail Bankingg 32 Customer Centric Transformation Program 38 Major Equity Participations 43 Page 4
Slide 5: Isbank at a Glance: ownership and network
Stocks are quoted at ISE and also traded at LSE in the form Free Float of GDR 30.4% Largest stake owned by employees via pension fund Ataturk Shares Isbank Pension Fund 1,061 domestic branches that cover all cities in Turkey 28.1% (Largest among private banks) 41.5% 3,509 ATMs (Largest ATM n
Slide 6: Banking Services and Other Financial Services
Banking Services Other Financial Services Page 6
Slide 7: Market share and rank
Market Share(%) 2009 H1 Rank(2) Total Assets 13.6 1st Loans(1) TRY Loans 12.9 1st FX Loans 13.3 4th Total Loans 13.0 2nd Deposits(1) Demand Deposits (3) 14.1 1st TRY Deposits 13.7 1st FX Deposits D it 15 5 15.5 2nd Total Deposits 14.4 1st Retail Products Volume of Debit Cards 17.4 1st Number of POS
Slide 8: Financial Highlights
Isbank at a Glance 5 Retail Banking 32 Customer Centric Transformation Program 38 Major Equity Participations 43 Page 8
Slide 9: Key highlights
• 70 bps expansion in NIM in 2Q mainly driven by further decline in funding costs… • 27% ROE (32% ROE in banking business)… • 69% Loan to Deposit Ratio and 16% Tier‐I Ratio – well positioned for a growth environment… • 100% NPL coverage maintained… • Decline in NPL formation – 37% less Loan Loss Pro
Slide 10: Total assets, loans, deposits, equity
Total Assets (TRY mn mn.) .) Loans (TRY mn mn.) .) 104.106 47.610 45.935 97.552 80.181 33.980 75.205 29.818 63.755 21 859 21.859 2005 2006 2007 2008 2009 H1 2005 2006 2007 2008 2009 H1 Deposits (TRY mn mn.) .) Shareholders’’ Equity (TRY mn Shareholders mn.) .) 63 539 63.539 66.479 10.604 11.170 46.3
Slide 11: Asset composition
(TRY mn.) 2008 2009 H1 Change Asset Composition Cash & Banks 18,625 18 625 18 801 18,801 1% Cash & Banks Securities (Net) 24,981 32,331 29% 19% 18% Securities Loans 47,610 45,935 ‐4% 26% 31% Participations (Net) 3,096 3,732 21% Loans Fixed Assets (Net) 1,953 1,945 ‐ Participations 49% 44% Other Asse
Slide 12: Loan portfolio and loans to deposits
Loan Portfolio (TRY mn mn.) .) Loans / Deposits Quarter on quarter growth in TRY loans… loans… 81,2% 46.445 45.935 74,9% 64,0% 69,1% 79,7% 52,3% 31.502 32.521 2008 2009 H1 Loans/Deposits TRY Loans/TRY Deposits FX Loans/FX Deposits TRY / FX Mix of Loans 14.943 23% 25% 26% 31% 29% 13.414 77% 75% 74% 6
Slide 13: Loan breakdown: retail and SME
...60 ...60% % comprised of higher Total Loans Consumer Loans (TRY mn.) mn.) yielding retail and SME loans.. loans 9,849 9,697 20% 21% Retail Loans 1% 1% 32% 9% 10% 52% 52 % Consumer General Purpose Consumer Loans 30% 28% Overdraft Credit Cards 10% 9% Auto Loans SME* 40% 40% Corporate 38% 39% Housin
Slide 14: NPL ratio and management of NPLs
NPL Ratio Management of NPLs 100% NPL provisioning 100% since 2003 2003… … 1,2% 1,0% 4,3% 2,5% 0,3% 1,4% 4,4% 5,1% 5,1% 4,2% TRY mn. 3,8% 500 297 161 240 212 253 252 643 485 188 368 207 122 113 28 130 140 143 2006 2007 2008 2009 Q1 2009 H1 08 Q1 08 Q2 08 Q3 08 Q4 09 Q1 09 Q2 ‐ Cost of Risk* Addition
Slide 15: NPL ratios by loan category vs sector
Lower NPL ratios in NPL Ratio by Loan Categories NPL Ratios Ratios‐‐ Isbank vs. Sector (2009 H1) consumer loans and credit cards compared to 8,4% 8,4% 8,9% the sector sector… … 6,1% 5,1% 5,1% 4,6% 4,4% 3,3% 3, % 3,4% 3,3% 3 3% 2,3% Consumer Credit Cards Total Loans Consumer Credit Cards Total Loans
Slide 16: Breakdown of securities portfolio
Breakdown of Securities Portfolio Total Portfolio (TRY mn.) mn.) TRY 32.331 Discount FX & Fixed ; 26.319 Floating; 24 326 24.326 24 981 24.981 23,80% FX 22.366 9,80% Discount TRY & Fixed ; Floating; 29,20% 37,20% 2005 2006 2007 2008 2009 H1 76 % of Securities are Available for Sale Average durations
Slide 17: Liabilities composition
(TRY mn.) 2008 2009 H1 Change Liabilities Composition Deposits 63,539 66,479 5% 10% 11% Equity REPOs & Money 7,007 7 007 9,349 9 349 33% 7% 6% Market 11% 10% Funds Borrowed 11,033 10,417 ‐6% Other 7% 9% Other 6,524 6,691 3% Equity 9,449 11,170 18% Funds Borrowed Total Liabilities 97,552 104,106 7% 6
Slide 18: Deposit base
l ... a clear iindicator di t off customer trust trust.. Deposit Base (TRY mn mn.) .) FX Deposits 66,479 63,539 TRY Deposits 39% 48,533 36% 46,399 37,222 36% 39% 41% 61% 64% 61% 64% 59% 2005 2006 2007 2008 2009 H1 Page 18
Slide 19: Deposits and market shares
Deposits (TRY mn mn.) .) Market Shares 15,5% 14,4% 14,1% 14,7% 14,3% 13,7% 64.188 66.479 9,9% 39.569 40.807 6,8% 6 8% 4,1% 24.619 25.672 TRY FX* Total 2009 Q1 2009 H1 2000 2008 2009 H1 * 14% increase in FX deposits when based on USD amounts. TRY Deposits FX Deposits Total Deposits TRY Savings Deposi
Slide 20: Demand deposit base
Largest demand deposit base * among private banks.. banks.... Demand Deposits (TRY mn mn.) .) Share of Demand Deposits in Total Deposits 9,221 8,788 7,991 7 991 7,678 86,1% 6,759 55% 54% 56% 47% 50% 13,9% 45% 5% 46% 6% 44% % Demand Deposits Other Deposits 50% 53% * Excluding Interbank Deposits 10.7
Slide 21: Client assets and investment accounts
... has reached a remarkable Client Assets ((TRY mn.) mn.)) No. Of Investment Accounts ((000)) total of TRY 98 billion. billion. 6.631 6.158 90,617 98,347 5.231 4.630 4 630 4.363 79,821 70,488 On‐Balance Sheet 59,952 68% 70% 61% 66% 62% 2005 2006 2007 2008 2009 H1 20% 18% 15% 13% 12% Sheet Off‐Balan
Slide 22: Capital adequacy
Capital Adequacy Regulatory Capital (TRY mn.) mn.) High CAR support supportss balance sheet growth going 12.146 11.884 16,7% 10.638 10.805 10.854 11.143 forward… forward … 16,3% 15,9% 15,2% 15 2% 15,4% 15 4% 15,4% 15 4% 2008 2009 Q1 2009 H1 2008 2009 Q1 2009 H1 CAR Tier I Ratio Regulatory Capital Ti
Slide 23: Quarterly operating income composition
Change (TRY mn.) 2009 Q1 2009 Q2 QoQ Operating Operati ng Income Composition N Interest Net I IIncome 1,090 1,220 12% Net Fees & Comm. from Banking NII 291 318 9% Serv. 56% 62% Net Trading Gains/Losses 196 81 ‐59% Net Dividends Received 150 172 15% 15% Commissions 10% 16% Released Provisions 178 156
Slide 24: Half-year operating income allocation
Change (TRY mn.) 2008 H1 2009 H1 YoY Operating Operat ing Income Composition Net Interest Income 1 819 1,819 2 310 2,310 27% Net Fees & Comm. from Banking NII 603 609 1% Serv. 53% 59% Net Trading Gains/Losses 329 277 ‐16% Net Dividends Received 265 322 21% Commissions Released Provisions 329 334 2%
Slide 25: Fees and commissions received
... supported by superior Fees and Commissions Received ‐(Gross) Gross) Gross Commission Income (TRY mn mn.) .) retail and corporate franchise.. franchise 8% 8% Non Cash Loans 343 9% 9% 319 Credit Appraisal 17% 17% Mutual Fund Man. And Other Inv.Acc.Fees 2009 Q1 2009 Q2 Credit Cards 42% 42% Commissi
Slide 26: Spread and NIM
Spread NIM High margins maintained in 7,8% 8,5% (1) the second quarter… quarter… 5,8% 5,1% 6,7% 1,8% 1,8% 6,3% 6 3% 2009 Q1 2009 H1 TRY FX Blended 2 4% 2,4% 1,8% Adj.. NIM (2) Adj 10,1% 8,2% 6,4% 6 4% 5,8% 5 8% 2009 Q1 2009 H1 TRY FX 1,9% 2,3% 2009 Q1 2009 H1 TRY FX Blended (1) Blended Net Interest
Slide 27: Cost / income
Cost / Income Cost vs. Income (TRY mn mn.) .) 3.927 43,6% 42,0% 45,2% 3.460 36,7% 34,2% 1.342 1.343 2005 2006 2007 2008 2009 H1 2008 H1 2009 H1 Cost Income Cost vs. Assets Cost Structure 17% 7% Other 4% 4% 7% 6% SDIF Fees 28% 3,2% 3,5% 2,9% 29% 2,7% Depreciation 54% Administrative 44% Expenses Staff
Slide 28: ROAE and ROAA
ROAE ROAA 31,8% 2,7% 27,6% 26,6% 2,3% 24,3% 2,2% 2 1% 2,1% 2 2% 2,2% 22,2% 21,6% 1,7% 1,7% 17,0% 1,6% 1,5% 15,1% 1,4% 13 7% 13,7% 11,9% 2005 2006 2007 2008 2009 H1 2005 2006 2007 2008 2009 H1 ROAE ROAE* ROAA ROAA* * Banking business Page 28
Slide 29: Market cap, earnings and payout ratio
Cap.. Comparison (TRY Market Cap (TRY mn .)) mn.) Earnings & Payout Ratio 36.1% 34.6% 32.7% 32.1% 23 105 23.105 20.311 17.972 32.4%** 1,702 14.024 1,509 11.342 1,109 956 2005 2006 2007 2008 2009 H1 635 Isbank is included in the following indices: • ISE‐100 • ISE‐30 • ISE‐Bank Index 2004 2005 2006 20
Slide 30: Credit ratings and outlook
R i Rating O l k Outlook ... ahead of Turkey’s Rating Outlook Long Term FC IDR BB Stable standards in various aspects of rating Global Scale Long Term LC IDR BBB BBB‐‐ Stable Long Term Counter Party Credit BB‐‐ BB Stable Short Term FC IDR B ‐ Long Term Certificate of Deposits BB‐‐ BB ‐ Short Term LC
Slide 31: Retail Banking
Isbank at a Glance 5 Financial Highlights 9 Customer Centric Transformation Program 38 Major Equity Participations 43 Page 31
Slide 32: Credit cards
14 different products for different customer segments Reward points by 102,121 merchant firms through 186,389 chains, called “Maxipuan” Maxipuan After the cooperation of Isbank with Ziraat Bank, regarding the use of Isbank’s “Maximum Card” brand, the number of cards using the “Maximum” advantages re
Slide 33: Retail banking area
... an area which Isbank dominates since its foundation.. foundation Page 33
Slide 34: Mutual funds
... 21 types of mutual funds Mutual Funds (T (TRY RY mn.) mn.) Number of Investors designed d i d for f different diff t risk i k 631.963 609.121 582.249 590.000 appetites.. appetites 552.346 5.659 6.137 5.140 5.158 4.523 2005 2006 2007 2008 2009 H1 2005 2006 2007 2008 2009 H1 Income From Funds (TRY
Slide 35: Payroll accounts and automated bill payments
... supported by payroll accounts and bill p payment y Payroll y Accounts Automated Bill Payments y agreements.. agreements 11.921 6.393 10.844 4.911 6.435.312 1.316.388 1.293.250 5 961 620 5.961.620 2008 H1 2009 H1 2008 H1 2009 H1 Amount (TRY million) Number of Accounts Amount (TRY million) Number
Slide 36: Use of non-branch channels
... are being used more Use of Non Non‐‐Branch Channels efficiently efficiently. ffi i tl . ( ) (%) 2005 2006 2007 2008 2009 H1 47% 44% 43% 45% ATM 26 26 26 24 22 49% Internet 20 22 26 29 29 Call Center 2 2 2 2 2 51% 53% 56% 57% 55% Kiosk 1 1 1 1 1 Telephone 2 2 1 1 1 2005 2006 2007 2008 2009 H1 Non
Slide 37: Customer Centric Transformation Program
Isbank at a Glance 5 Financial Highlights 9 Retail Banking 32 Major Equity Participations 43 Page 37
Slide 38: Agenda of the Transformation Program
Agenda of the Transformation Program @ What is the Program doing? @ What will be the benefits to the bank? @ What will be the result? Page 38
Slide 39: Program moving Isbank to a customer centric organisation
The Program is helping Isbank Isb ank to move to a more customer centric organisation with the Targeted Client Centric From Organization customer as the key focus. communication Organization and Distribution by product to This requires change in the initiatives Organization by current operating mode
Slide 40: Countering increased competition
The Programme is helping Isbank to counter the increase in competition by: by: Page 40
Slide 41: Increasing shareholder value
We will increase our shareholder h h ld value l through th through: h: Page 41
Slide 42: Major Equity Participations
Isbank at a Glance 5 Financial Highlights 9 Retail Banking 32 Customer Centric Transformation Program 38 Page 42
Slide 43: One of the biggest conglomerates in Turkey
...as one of the biggest ...as gg conglomerates in Turkey. Turkey. Page 43
Slide 44: Sectoral breakdown of participations
Sectoral Bre Breaakdown Financial 41,3% Non‐Financial 58,7% 13,2% 9,4% Telecom Other Banks 20,8% Insurance Strategic 21,7% Core Non‐financial Financial Non‐core Glass Financial Ins. Business TRY 4.8 48 Areas 24,7% 10,2% billion Listed Non ‐ Listed 46 2% 46,2% 53,8% As of June 2009 2009,, Isbank has
Slide 45: Sisecam
Isbank (64 %) General Information Market/Production Market/Production Shares (%) A leading l di flatfl glass, l glassware, l glass l packaging, k i soda d Turkey Europe2 World3 ash and chromium chemicals producer in the domestic Flat Glass 80.0 13.13 3.7 market. Backed by its vision, Şişecam exp
Slide 46: Sisecam production facilities abroad
The Group obtains efficiency and spreads its operationall riskk byb positioning its production facilities in the fast growing neighbouring countries countries.. Flat Glass Glassware Glass Packaging Chemicals 46
Slide 47: Sisecam export markets by product
Glassware (%) (2) Chromium Products (%) Bulgaria 30 Taiwan 77 Iran 30 Italy 60 Ukraine 29 S. Korea 40 U.K. 27 China/Hong Kong 24 Russian Federation 20 Flat Glass (%) Italy 17 Bulgaria 62 Germany 11 Albania 50 Spain 9 Greece 25 Romania 20 Glass Fibre (%) Soda Ash (%) Iran 18 Serbia 99 France 5 Bulgar
Slide 48: Avea
Isbank Group 18.63% Turk Telekom 81.37% Aria and Aycell merged under TT & TIM as of February 19 19,, 2004 Avea brand has been successfully launched in June 20042004.. The coverage and efficiency have increased significantly due to the combination and integration of 2 GSM networks. networks. A number
Slide 49: Group companies and shareholdings
Bank’s Shareholder’s Field of Group Assets (1) Market Group p Company p y Direct Equity (1) A ti it Activity Share (%) (USD 000) Share (%) Share (%) (USD 000) Türkiye Sınai Kalkınma Bankası A.Ş. Investment Bank 40.52 50.10 3,998,737 (6) 476,432 (6) 27 (1) (6) İşbank GmbH Banking 100.00 100.00 747,92
Slide 50: Investor Relations contacts
Süleyman H. Özcan Head of Investor Relations Division Phone : + 90 212 316 16 02 E‐mail : suleyman. suleyman.ozcan@isbank ozcan@isbank..com com..tr Alper Turgal Assistant Manager of Investor Relations Division Phone : + 90 212 316 16 10‐ 10‐11 / 316 30 36 E‐mail : alper. alper.turgal@isbank turgal@i
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