Turkiye Sinai Kalkinma Bankasi A.s. · BIST:TSKB
Turkiye Sinai Kalkinma Bankasi A.s — Türkiye Sınai Kalkınma Bankası A.Ş. (TSKB) — Q3 2023 Earnings Presentation
30 slides from Turkiye Sinai Kalkinma Bankasi A.s's earnings presentation, November 2023
Slide 1: The Industrial Development Bank of Türkiye FI&IR Presentation 3Q-23
The Industrial Development Bank of Türkiye FI&IR Presentation 3Q-23 Bank-only Results Corporate Banking Investment Banking Advisory Services
Slide 2: TSKB at a Glance
TSKB at a Glance 4 Turkey tis Bank Group 40.2% Ly Ly) Gy Lyle oe Shareholding baae Z fakifban! AKG AN Fitch LTFC B- B Free Float* & Other Moody’sLTIR B3 B3 SAHA Corporate Governance Rating yey YY Sustainalytics ESG 6.9 Negligible Risk As of 3% of November 2023 Risk Rating yy ye, CORPORATE BANKING IN
Slide 3: A Unique Business Model
A Unique Business Model = Long term tenor in liabilities: 11 years * Medium term in assets: 5 years = Diversified funding tools = Amortized loan book = Multi-disciplinary assessment during allocation = Sector specific research analysts during allocation and monitoring period = Strong collateralizati
Slide 4: Main Stakeholders of the Bank
Main Stakeholders of the Bank A trustworthy partner in; Large Corporates, MidCap Companies & SME's Its field experience Cooperation in various areas such as; corporate loans, investment banking activities and advisory services Ministry of Treasury and Finance Its capacity to introduce innovative the
Slide 5: Sustainability is Well Integrated into Our Business Model
Sustainability is Well Integrated into Our Business Model health and safety © Supporting less developed regions Support for employment in Turkey; ® Encouraging women participation to the economy ERB Support transition to low ye carbon economy © Providing financing to operational Environmental & Soci
Slide 6: TSKB Sustainability Journey
TSKB Sustainability Journey - | First Carbon Neutral Bank of Turkey Environmental Factor in Credit Appraisal Process Environmental Management System Yy coy 1980 1990 2005 2007 2008 2009 First Environmental Loans | + UNEP FI + ISO 14001 Certificate + Launch of www. cevreciyiz.com 0Og cevreciyiz. * ce
Slide 7: • • • • • • • • • • • • • •
• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •
Slide 8: Net-Zero Transition Pathway
Net-Zero Transition Pathway In 2022, we became UN NZBA member and submitted our Scope 1-2-3 emissions targets to SBTi. As of June 2023, SBTi approved our below targets. Scope 2 continue active annual sourcing of 100% renewable electricity through Scope 1 2030 ( A ) BN reduce absolute scope 1 GHG Zo
Slide 9: 9M-23 Sustainable Banking Developments and ESG Ratings
9M-23 Sustainable Banking Developments and ESG Ratings UD) sustainatytics Wepp Sustainalytics ESG Risk Rating CDP Climate Change (updated as of Nov. 6‘) Score Range 0-40+ A/D- Score further improved to 6.9 A- Negligible risk category Leadership First place in Turkiye ———@ ESG GLOBAL 50 TOP RATED 10t
Slide 10: 3Q-23 At a Glance
3Q-23 At a Glance + Sustainable banking income generation + NIM performance above guidance + Additional TL 150 million free provision in 3Q-23 Maintained profitability and earnings quality + FX-adjusted 9M-23 loan growth remained almost flat + NPL further dropped down to 1.8% + Superior coverage pos
Slide 11: Financial Guidance (Bank Only)
Financial Guidance 3Q-23 Figures YE-23 Guidance Year-end Expectation (Bank Only) % % Growth FX Adjusted Loan Growth ~2 ~5 ✔ Profitability Net Interest Margin* 6.6 >5 ✔ Fees & Commissions Growth 140 ~100 ✔ Return On Equity ** 42.3 ~35 ✔ Efficiency OPEX Growth 124 ~90 In Line with Inflation Cost/Incom
Slide 12: Strong top line, backed by robust core banking income & CPI Linker revenues
AP Strong top line, backed by robust core banking income & CPI Linker revenues Net Banking Income-TL mn Net Banking Income vs Provisions - TL mn 3,534 ILS Robust core banking 54% aie income 5,192 Strong CPl-Linker Income 20-23 30-23 9M-22 9M-23 9M-22 9M-23 ‘= Net Banking Income exc. CPl&Trading = Ne
Slide 13: Banking Sector vs TSKB
Ales Banking Sector vs TSKB BANKING SECTOR 18.5% Banking Sector "Reported figures Deposit 67% Equity 9% CAR* 23.3% TSKB Cost to Income 30.6% 9.6% Banking Sector TSKB Repo 4% |_| Syndication | Funds Borrowed 8% Securities Issued 2% Subordinated bonds her | |and loans (ATI + Tier I) one 2% Loans/Asset
Slide 14: Comfortable FX Liquidity and Maturity Profile
Comfortable FX Liquidity and Maturity Profile Maturity Profile of External Debt - USD mn Funding / Total Liabilities (exc. Equity & Oth.) - USD mn eA Ci |e | / Ay 2% ™ Guaranteed DF Funding Unguaranteed DFl Funding 16% 16% 21% Securities Issued 13% 12% 2023 2024 2025 >=2026 12% Z mSyndication &Other
Slide 15: Long Term DFI Funding Base
Long Term DFI Funding Base Outstanding DFI Funding Base - 3Q-23 IBRD 44.1% AB Yearly Multilateral Funding Agreements - USD mn EIB New Loan Agreements + KfW| EUR 100 million * OeEB| EUR 25 million voc RR 5 AFD 5.2% CDB 4.1% IDB 3.8% oe pe a “Een Ei cano | 1.9% 2016 2017 2018 2019 2020 2021 2022 9M-23
Slide 16: Outstanding Project Themes Shaping Future Loan Book
16 Outstanding Project Themes Shaping Future Loan Book Energy and Resource Efficiency Women’s Employment and Equal Opportunity Renewable Energy Midcap Financing Supporting Exporters Regional Development Supporting Employment Sustainable Agriculture Industrial Development Sustainable Tourism Occupati
Slide 17: Resilient Asset Composition
7 Resilient Asset Composition Asset Composition - TL bn 2% 4% 10-23 20-23 3Q-23 mLoans mSecurities mCash&MM mNonIEAs & Other Remaining Average Maturity - Years Investment Loons IN 5.0 Working Capital Loans |) 2.4 APEX Loans I 1.9 DF! Linked working capital loans are 3.7% Weight | 1% 20% 9% ) 4.8 yea
Slide 18: Risk Management Pillars
Risk Management Pillars Credit Risk * Monitoring the clients individually with analysing the financials * Preparing monitoring reports for the clients at least once a year * Keeping track of internal and external (if it is done) ratings of the customers, reviewing the internal ratings annually = Act
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Slide 20: Loan Breakdown by Sector
Electricity Generation 35.9% Metal & Machinery 8.8% Finance 8.6% Tourism 6.5% Logistics 5.6% Health & Education 5.5% Electricity/Gas Distr. 4.9% Construction & Construction Materials 4.7% • • Chemistry & Plastics 4.1% • • Food & Beverage 2.8% • Textile • 2.6% Paper and Forestry Products 2.5% • Other
Slide 21: Electricity Generation Portfolio by Source
1.6 bn 1.9 bn 1.9 bn 1.9 bn 1.9 bn 1.7 bn 1.6 bn 4% 6% 6% 7% 8% 11% 5% 5% 5% 6% 12% 9% 11% 13% 35% 37% 35% 37% 39% 36% 34% 17% 18% 19% 20% 19% 19% 20% 37% 35% 35% 31% 24% 23% 21% 2017 2018 2019 2020 2021 2022 3Q-23 Hydro Geothermal Wind Biomass Solar • •
Slide 22: 100,691 13,040 3,651 2,098 1,999 % 20.8 1.7 8 10.0 7 29.1 5 17.9
100,691 976 13,040 3,651 2,098 1,999 % 35 17 20.8 25 41 16 41.7 8 10.0 7 29.1 5 17.9 4 8.8 2 43.0 1 47.0 5 14.0 28.0
Slide 23: Security Yields
Security Yields Excluding CPI CPI 75.6% 80.4% • 58.6% 57.7% 47.8% 47.5% 42.8% • 19.4% 19.9% 22.6% • 17.3% 18.8% 19.1% 18.9% 1Q-22 2Q-22 3Q-22 4Q-22 1Q-23 2Q-23 3Q-23
Slide 24: Income Statement Highlights
Income Statement Highlights TLmn 9M-22 9M-23 mom 20-23 30-23 00 stelar nn generation backed Net Interest Income 4405 6,518 48% | 2,349 2,586 10% by solid loan spread Trading | &security book racing icone 951 1,893 99% 1,534 255 (83%) contribution woe 13 tchi Net Fees & Commissions 120 287 140% 73 15
Slide 25: 4Q-22 1Q-23 2Q-23 3Q-23
7.5% 7.6% 7.0% 5.9% 4Q-22 1Q-23 2Q-23 3Q-23
Slide 26: Comfortable and resilient solvency metrics
Comfortable and resilient solvency metrics Capital Ratios Without BRSA Temporary Measures Le Y Evolution of RWA and Equity- TL bn 136.6 142.1 104.3 12.0% 8.5% 13.9 18.9 16.2 229 UL, Yili 10-23 20-23 3Q-23 10-23 20-23 3Q-23 Tier | Ratio CAR With BRSA Temporary Measures - CAR: 23.3% | Tier: 22.2% | CE
Slide 27: 2S BS Q gf x
2S BS Q gf x
Slide 28: Balance Sheet
28 Balance Sheet Cash and Banks Securities Loans (Gross) Provisions Subsidiaries Other Total ST Funds LT Funds Securities Issued Repo & MM Other Subordinated Debt Shareholders’ Equity 17,909 25,747 115,829 ~6,648 6,297 4851 163,986 5314 93,818 28,897 3,021 8,576 5,463 18,897 31/03/2023 30/06/2023 30
Slide 29: Detailed Income Statement
29 Detailed Income Statement TLmn Net Interest Income inc. Swap Cost Net Interest Income CPI Linkers Swap Costs Net Commissions Other Income Dividends Other Trading & FX gains/losses FX gains/losses MtM gains/losses Trading gains/losses Banking Income OPEX (-) Net Banking Income ECL (-) Stage | Stag
Slide 30: TSKB Financial Institutions & Investor Relations
30 ool Oe TSKB Financial Institutions & Investor Relations TSKB Financial Institutions & Investor Relations ir@tskb.com.tr www.tskb.com Meclisi Mebusan Cad. 81 Findikli 34427 istanbul
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